The recent move by the Massachusetts Pension Reserves Investment Management Board (MassPRIM) to reduce their exposure to fund of hedge funds and initiate a direct hedge fund investment program highlights the trend by institutional investors to bypass fund of funds for direct hedge fund investments. In addition to MassPRIM, the $23 billion Employees Retirement System of Texas, the $76 billion Ohio Public Employees Retirement System and the $2.5 billion Texas Permanent School Fund have all begun to lay the groundwork for direct investment programs as well. The charts below illustrate the trend towards direct hedge fund placements:
This is the next in a series of guest blog posts by IntraLinks’ collaborators, partners, and vendors. Daniel Strachman is a financial expert with more than fifteen years of Wall Street experience. He is nationally recognized as a strategist, futurist and commentator on Wall Street, the economy, and investment strategy. Daniel is also the moderator of the HEDGEAnswers Conference Call Series, a unique educational program on hedge fund structures and investment strategies. He is also the author of seven books on investment strategies. Learn more about him at www.danstrachman.com. He can be reached at das@hedgeanswers.com.
A revolution here, a revolution there and before you know it, you have real change! Well, the events in the Middle East seem to point to some real change coming to that part of the world. With change comes volatility and investors around the globe are experiencing significant market dips and dives as the events continue to unfold. Price swings are not just occurring in oil and other commodities but in equities and fixed income securities as well. It is clearly critical to have investment products in your portfolio that zig when the markets zag in order to protect your assets during these uncertain times.
I recently wrote an article for Hedge Fund Journal and asked the question, “Does having your investor letter or risk report leaked to the media (a.k.a. headline risk) hurt your ability to compete with other firms for allocations or is it just embarrassing?”
I would say both. However, for a magazine like HFJ I needed to answer the question more scientifically. I found a survey of investors conducted by Deutsche Bank. The survey showed that investors did in fact believe headline risk was damaging to a fund’s reputation and a deterrent to investing. What was even more interesting is the survey found that investors, particularly institutional investors, felt headline risk was more of a turnoff than invoking a gate, side pockets or changing liquidity terms.
Sometimes even the latest technology can’t outdo some good, old fashioned mixing of business with pleasure — an approach we took for our recent Alternative Investments Symposium held in New York for a small group of key clients and players in the industry.
We kicked off the symposium with a dynamic welcome event at STK, an upscale restaurant in downtown Manhattan. Over dinner and drinks, a mixture of private equity firms and hedge funds mingled with IntraLinks staff and executives including Chief Marketing Officer Greg Kenepp and SVP North American Sales Mark Williams. The dinner was the ideal setting for everyone to get to know each other better before the more serious part of the event began the next morning.