If a hedge fund is going to conduct the necessary due diligence and optimize risk through allocation adjustments, paying a price for increasing risk adjusted returns is justifiable.
Zurich, Switzerland (PRWEB) October 16, 2008
In an effort to accommodate investor demand, Finvest Asset Management has been provided with a mandate to allocate approximately $300 million to the fund of funds arena, as part of a low risk strategy to capitalize on the pull-back in the market.
Allocations will be made to funds which have a track record of at least 3 years, have an attractive sharp ratio, and who are targeting between 10 to 15% per annum. Additionally, fund of funds that may have incurred negative returns will not be excluded from the selection process. Although many investors are running for cover, and fund redemptions are occurring at an unprecedented rate, the initiative by Finvest demonstrates that level headed investors are taking a long term view, and appreciate that while caution is not out of place, the markets will ultimately achieve a platform of stability.
Finvest Portfolio Strategist, Mayer Greenwald admits, "The decision to allocate to a hedge fund goes against the current trend, however we see a tremendous amount of upside in the fund of funds space, providing that portfolio managers apply the appropriate risk management." He believes that ultimately a good fund of funds can provide value, in its ability to optimise allocations, and achieve an appropriate risk reward profile.
Historically, the layer of double fees which is attributable to fund of funds has acted as a deterrent to many investors. Consequently, they have preferred to create their own fund of funds through the application of allocations to a self-created fund of single strategy funds. Finvest's Mayer Greenwald's response to becoming a victim of the "Fund of Fees" school of thought is: "If a hedge fund is going to conduct the necessary due diligence and optimize risk through allocation adjustments, paying a price for increasing risk adjusted returns is justifiable." Finvest will not be seeking to raise any further capital for its fund of funds, as the initiative is being conducted on behalf of a European institutional investor. Finvest manages several hedge funds which are open to non-US investors and has significantly outperformed its year to date benchmarks.
Finvest Asset Management
Harry Rogers, +41442083164
pr @ finvestfunds.com
About Finvest Asset Management :
Finvest Asset Management is a global alternative asset management firm committed to the provision of superior portfolio management and risk management solutions for non-US institutions and high net-worth clients.