Let’s Be Clear: Investor Survey Shows Transparency Improving in Alternative Investments – Still Work to be Done
To shed light on the informational needs of investors, Intralinks and Opalesque commissioned a survey of the global investor community.
5 May 2014
The momentum for allocations to alternative investments from 2013 into 2014 has clearly not slowed. HFR is reporting that hedge fund assets hit another record in the first quarter of 2014, with new $26.3 bn of new capital added in the first quarter bringing total industry assets to $2.70 Tn, the seventh consecutive quarterly record. Not to be outdone, private equity also saw an uptick in first quarter activity with 185 funds reaching a final close in Q1, raising an aggregate of $98 bn, a 14% increase over the same period last year.
Given the large amounts of capital being allocated in Q1, it is clear that institutions continue to be the primary driver for growth in both the hedge fund and private equity markets. With this continued growth, the spotlight now shines not only on manager performance but on the operational aspects of how fund managers will be able to manage and service their growing ranks of demanding institutional investors.
- What type of information do investors want?
- Why do they need it?
The results were quite clear – while there has been some progress in investor communication and transparency, there is still room for improvement. Here are just a few highlights from the survey:
- While hedge fund investors have seen an increase in transparency over the past three years, there is still room for improvement, with only half of the respondents indicating an appropriate level of transparency from their managers
- 89 percent of hedge fund investors and 71 percent of private equity/real estate investors have chosen not to invest in a least one new fund due to concerns over the lack of transparency
- Over 85 percent of investors would like to have their information delivered in an electronic/data format to facilitate their analyses
Access the full report, Let’s Be Clear: A Common View On Transparency, to understand the current state of investor communications and explore issues around transparency.