The third quarter was a good quarter for hedge fund performance, with figures posted in July and September representing two of the three strongest months for returns from hedge funds in 2013 so far.
Hedge funds charging higher performance fees are more successful at producing consistent long-term absolute returns, according to a report by Preqin.
The overall outlook for investors in alternative assets is positive, with the majority looking to either maintain or increase their capital commitments in the next 12 months and the longer term, according to a survey by Preqin.
In a settlement with the Securities and Exchange Commission, billionaire hedge fund manager Philip Falcone has agreed to be barred from the securities industry for five years.
For at least a decade, institutional investors have been encouraged to move beyond a traditional 60/40 stock/bond allocation, in search of both alpha, and better beta.. In part, they were encouraged by the outstanding returns Yale University’s chief investment officer, David Swensen, produced.
Since the financial crisis of 2008, pension plans have struggled for additional returns. Unable to meet their liabilities with the typical equities and fixed income portfolio, a lot of plans have been moving into alternative investments, specifically, hedge funds.
In an informal poll of investors in attendance at a recent CIBC Mellon event in Toronto, 38% of respondents indicated they were invested in hedge funds and 38% said they were undecided. When asked if they were invested in or plan to be invested in alternatives, hedge funds drew the most interest.
Towers Watson recently released its annual Global Alternatives Survey in conjunction with the Financial Times of London, England. The survey, in its ninth year, gathered information on alternatives products offered to investors, including pension funds, sovereign wealth funds (SWFs) and insurance companies, as at the end of 2011.
Institutional investors are spurring hedge funds to grow operations and increase transparency, according to a report by KPMG and the Alternative Investment Management Association (AIMA).
Hedge funds have outperformed traditional asset classes for the last 17 years, says a KPMG/AIMA study, The Value of the Hedge Fund Industry to Investors, Markets and the Broader Economy.