By Andrew Beer, Chief Executive Officer of Beachhead Capital In this note, we examine the relationship between the hedge fund fee structure and how it impacts alpha. In the early days of the industry, higher management fees were designed to cover costs of a deep and rigorous research and investment process; performance fees were meant […] Read more »
Asian Hedge Fund Trends Include Consolidation Pressure
By GFIA of Singapore Historical overview GFIA began coverage of the Asian hedge funds industry in September 1998. At that time the industry was tiny and all participants mostly knew each other. The Asian crisis was still unfolding, and the industry was a collection of maverick specialists. It was another five years before the industry […] Read more »
Hedge Fund Beta Exposure of Towers Watson Clients
From Hedge Fund Insight staff In a recent paper Towers Watson provided an overview on the smart beta investment thesis and some of the more common and implementable strategies. According to the consultants smart beta techniques are worthwhile pursuing in asset classes that have historically been expensive, difficult to access and/or illiquid in nature. The […] Read more »
Factoids on Funds of Hedge Funds
NOTES ON BUBBLES: 1. Net return gaps 330 bps (5-year), 210 bps (3-year), 160 bps (1-year). FoHFs offer lower volatility than single managers (lower standard deviation) and their correlation to broad indices on a 1-, 3- and 5-year basis is lower than single managers. 2. The traditional 1 & 10 fee model is no longer […] Read more »
FACTA and AIFMD Constraining Smaller Hedge Fund Manager Growth
By Peter Douglas, GFIA We recently were asked to source a shortlist of established, differentiated, Asian boutique hedge funds, for a distribution company. The deal between the distribution company and the funds, if concluded, would be that the distribution company would make introductions to European institutions, in return for a fee share. We anticipated that […] Read more »
Hedge Fund Managers Are Increasingly Accommodative On Fees – Towers Watson Survey
From The Towers Watson Global Alternatives Survey 2013* The key trends for hedge funds identified in the survey relate to both single manager hedge funds and funds of hedge funds (FoHFs). The FoHF industry continues to adjust to the new normal, with FoHFs increasingly working with investors in some form of customised or bespoke manner. […] Read more »
Infogram of Different Perceptions of Investors and Hedge Fund Managers
Source: Ernst & Young Read more »
Net Hedge Fund Formation Down in 2012
By Hedge Fund Research, Inc. of Chicago Total hedge fund industry assets increased to a record of $2.25 trillion, according to the latest release of the HFR Market Microstructure Industry Report, released today by HFR, the leading provider of indexation, research and analysis for the global hedge fund industry. New fund launches totalled 1,108 for […] Read more »
Why The Vast Majority of Hedge Funds Underperformed Indices
By Dr. Harold Ehrlich, CFA, Ehrlich Associates, LLC Sad to say, the vast majority of all hedge funds worldwide have well underperformed virtually every major stock or bond index for some four years now. Adding insult to injury, investors in such funds have paid 2% management fees and 20% of (paltry) profits for the privilege […] Read more »
Large Investors Negotiate Terms With Offshore Funds
Ingrid Pierce, Global Managing Partner, Walkers Satisfying investor demands: IFCs must promote compliance and high governance standards as investor power reaches unprecedented levels. As consolidation in recent years has led to fewer, larger players, the funds industry is now witnessing the emergence of a new generation of influential single investors with an unprecedented amount of […] Read more »