Hedge Fund Demand

Alternative Investment Strategies are the Top Search Choice In ‘08
March -2008 | Source: Hedge Fund Daily

Eight out of 10 consultants say they plan to concentrate on searches for alternatives managers this year, with a heavy emphasis on hedge funds. According to the 2008 Consultant Search Forecast by Casey Quirk & Associates and eVestment Alliance, one-third of consultants surveyed expect to limit their focus exclusively to HF managers, with a number of them seeking funds of hedge fund managers. “We knew alternatives would be important. We did not know the extent to which this would drive flows, Casey Quirk partner Yariv Itah said in an interview with Pensions & Investments Online. The latest push into altneratives, says Itah, is “the second wave of investors,” who until now have sat on the sidelines of the alternatives market. “Those investors have concluded," says David Hammerstein, chief strategist at Yanni Partners, that “the current dislocations in the market provide a good time for entry.” Hammerstein told PIO that roughly 10-15% of his firm’s clients are mulling a move into HFs in 2008. The survey also found:

• Long/short and multi-strategy funds will be the most popular search for those investing directly in hedge funds, with real estate, especially international, another hot area. 
• Foreign equity is said to be the second most common search, while it’s first among Canadian consultants. 
• 27% of consultants polled prefer global equity more than they do international portfolios, compared with 16% last year.
• Firm reputation was mentioned as the most important trait for a hedge fund manager, with performance and quality of HF personnel tied for second.