AIMA

The Alternative Investment Management Association

Alternative Investment Management Association Representing the global hedge fund industry

Increased partnership between investors and hedge funds - AIMA-Barclays survey

24 June 2014

  • Sharing of knowledge and resources most common form of partnership

  • Partner investors likely to be ‘stickier’

  • Combined AUM of those surveyed $2.2 trillion

London – 24 June 2014: Investors increasingly are striking partnerships with hedge funds, underlining the closer collaboration taking place between the hedge fund industry and its investor base, according to a new survey by the Alternative Investment Management Association (AIMA), the global hedge fund industry association, and Barclays.

According to the new survey of investors and managers, called ‘The Extra Mile: Partnerships between Hedge Funds and Investors’, partnerships of varying forms between hedge funds and their investors are becoming increasingly common.

More than three-quarters of managers and two-thirds of investors who took part in the survey said they had entered into partnerships.

The survey found five key elements of partnerships: access to expertise and resources; customised products and solutions; co-investment; product seeding; and equity stakes.

The survey revealed a number of benefits to investors, including improved knowledge and understanding, better alignment of interest with managers, and better value for money.

Both larger and smaller managers and hedge funds of all strategies were found to be striking partnerships. Benefits to managers included “stickier” or more loyal investors, support for new product development, cross-selling opportunities and the offer of investor references.

The investors surveyed manage a combined $2 trillion in assets, of which approximately $260 billion is allocated to hedge funds. They include pension funds, endowments, foundations, sovereign wealth funds and family offices globally. The managers surveyed manage approximately $200 billion in assets.

Jack Inglis, AIMA’s CEO, said: “It is encouraging that so many hedge funds and their investors are striking such deep and wide-ranging partnerships. These arrangements represent a win-win for both sides, with significant benefits for both the manager and the investor.

“What the survey shows is that managers are truly going ‘the extra mile’ in terms of sharing knowledge and resources and providing customised products and services to their investor partners. These partnerships are also providing further evidence of very high levels of satisfaction among investors in their hedge fund investments.”

“The publication of this paper comes at an important time in the evolution of the hedge fund industry. Amidst the on-going process of institutionalisation, investors are actively pursuing a more direct engagement with the underlying hedge funds in which they are invested,” said Michelle McGregor-Smith, the Chief Executive of British Airways Pension Investment Management Ltd and the Chair of the AIMA Investor Steering Committee, which helped to direct the survey.

Lou Molinari, Managing Director, Global Head of Capital Solutions, Barclays, said: “The growth of partnerships represents an exciting new direction for the hedge fund industry as it continues to evolve. Successfully building partnerships with investors can allow managers to grow their business whilst increasing the stability of their assets under management, and cater to the specific needs of an increasingly-sophisticated investor base.

“Managers who are interested in pursuing partnerships should put in place a strategy to do so, identifying those investors they want to partner with, and deciding which of the elements of partnership they are best-placed to deliver.”

- Ends -

Note to editors
To download ‘The Extra Mile: Partnerships between Hedge Funds and Investors’, click here:
http://www.aima.org/en/document-summary/index.cfm/docid/C2EC4BE7-D014-49A0-8195917E4849C81D

For media enquiries, please contact:
Dominic Tonner, AIMA’s Associate Director, Communications
Tel: +44 (0)20 7822 8380
Email: dtonner@aima.org

About AIMA
As the global hedge fund association, the Alternative Investment Management Association (AIMA) has over 1,400 corporate members (with over 7,000 individual contacts) worldwide, based in over 50 countries. Members include hedge fund managers, fund of hedge funds managers, prime brokers, legal and accounting firms, investors, fund administrators and independent fund directors. AIMA’s manager members manage a combined $1.5 trillion in assets (as of March 2014).

All AIMA members benefit from AIMA’s active influence in policy development, its leadership in industry initiatives, including education and sound practice manuals, and its excellent reputation with regulators worldwide.

AIMA is a dynamic organisation that reflects its members’ interests and provides them with a vibrant global network. AIMA is committed to developing industry skills and education standards and is a co-founder of the Chartered Alternative Investment Analyst designation (CAIA) – the industry’s first and only specialised educational standard for alternative investment specialists. For further information, please visit AIMA’s website, www.aima.org.

About Barclays

Barclays is an international financial services provider engaged in personal banking, credit cards, corporate and investment banking and wealth management with an extensive presence in Europe, the Americas, Africa and Asia. Barclays’ purpose is to help people achieve their ambitions – in the right way.

With over 300 years of history and expertise in banking, Barclays operates in over 50 countries and employs approximately 140,000 people. Barclays moves, lends, invests and protects money for customers and clients worldwide.

The Capital Solutions team within Barclays Prime Services offers a unique blend of industry insights and tailored client solutions for a broad range of issues.

For further information about Barclays, please visit our website www.barclays.com.
 

 
 
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