Institutional Hedge Fund Investing Comes of Age: A New Perspective on the Road Ahead

Jun
1
2011

Institutional Hedge Fund Investing Comes of Age: A New Perspective on the Road Ahead

By SEI Knowledge Partnership

Confidence Returns While Complexity Grows

White Paper: Institutional Hedge Fund Investing Comes of Age (PDF 27 pages, 2.4MB)

Over the last two years, the practice of hedge fund investing has leaped in maturity as investors and fund managers alike have learned they can take nothing for granted, including liquidity and absolute returns.

Our fourth annual survey of institutional investors, done in collaboration with Greenwich Associates, reveals that while investors still believe in the benefits of hedge funds, they are seeking a better handle on the complexities.

Among the key findings:

  • Investors have modified their expectations to combat performance challenges. In fact, “meeting performance challenges” tied with “transparency” as the greatest challenge in hedge fund investing. 
  • Concerns about the level of disclosure have intensified. Nearly 70% of investors name a lack of transparency as their biggest worry. 
  • Investors and consultants overwhelmingly expect hedge funds’ institutional business to grow.

Having come through two tumultuous years, institutional investors say their commitment to hedge funds is intact. But they are operating with a heightened awareness of risks and actively applying the lessons recently learned.

In Institutional Hedge Fund Investing Comes of Age you can read about what managers need to know, current investor hot buttons, and some good news for the industry.