Confusion and the confusing things that cause it
Aug 19th, 2008 | Filed under: Hedge Fund Industry Trends“The future ain’t what it used to be.”
American baseball player and patron saint of confusion had an obvious knack for making ironic, contradictory and logically self-referential observations about daily life. Had he been in the hedge fund industry, he might have really enjoyed this week.
Several recent hedge fund stories seem strangely inconsistent with each other. First Euromoney’s EMII.com website ran a story called “FoF Assets Lead Hedge Fund Growth“. And at the same time, Investment News ran a story titled ”Funds of hedge funds losing their luster“. So which is it, the best of times or the worst of times?
A closer read of both articles reveals that both stories are more similar than the headline writers have let on. EMII was referring to a Finalternatives piece that acknowledges the recently-acquired taste for single-manager funds displayed by investors:
“While many investors can and have chosen to bypass FoHF structures in order to invest ‘direct’, for the past 10 years assets under management under the FoHF structure grew faster than AUM for all hedge funds combined.”
Investment News seems to agree, with the caveat that this trend is actually coming to an end rather quickly. They cite data from Morningstar that indicates single manager hedge funds had a net inflow of over US$10 billion in June while fund of funds said sianora to $9.7 billion. Says Investment News:
To continue reading this article please login (at the right) or click here to learn more about accessing our archives.
