Sunday, November 3, 2013

UPDATED--Wha? "Family Offices Look to Invest More Than $30 Billion in Hedge Funds in Next Year"

Update below.
Original post:
It's time for some families to fire some advisors. This is as weak as being in a hedge fund that buys the SPY.
From the Managed Funds Association blog:
A recent survey from Barclays shows that family offices are looking to invest $4 billion in hedge funds  over the next year.  This is in addition to an expected reshuffling of nearly $29 billion in aggregate existing hedge fund investments.  All told, the survey shows that in the coming year, “fund operators can expect to see some $33 billion of ‘money in play’ from family offices,” according to Hedge Fund Alert.

This news comes as the past two years have found family offices liquidating around $6 billion of hedge fund assets, largely redeploying the funds in long-only investments.  Now, it seems, family offices are looking to hedge funds not only for long/short equity strategies, but event-driven and global macro strategies as well.
The survey shows that family offices are now looking to protect gains made over the last four years.  They see long/short hedge funds “as better positioned to make money when the market turns volatile,” Anurag Bhardwaj of Barclays told Hedge Fund Alert.  The publication also noted that some family office investors seek hedge funds for a narrow profile, such as funds that aim to double investor capital over five years with strategies that are uncorrelated to traditional investments.

Barclays’ report estimates that family offices have a global total of $270 billion invested in hedge funds, more than 10% of total investable assets.  “Above all,” the report concludes, “hedge fund managers need to deliver on their original value proposition of being nimble and return-hungry to attract family offices.”...MORE
Why You Should Fire the Family Office That Recommends Outside Hedge Funds