AIMA

The Alternative Investment Management Association

Alternative Investment Management Association Representing the global hedge fund industry

AIMA and Deutsche Bank publish new Roadmap to Hedge Funds for institutional investors

20 November 2012

The Alternative Investment Management Association (AIMA), the global hedge fund association, and Deutsche Bank today announced the launch of a new edition of the educational guide for institutional investors in hedge funds - the Roadmap to Hedge Funds.

The new Roadmap to Hedge Funds, published jointly by AIMA and Deutsche Bank, outlines how the volatile external environment has driven an ever greater need for active risk management. In re-affirming the case for investing in hedge funds, the Roadmap highlights how the industry responded swiftly to the losses of 2008. The average hedge fund recovered from its 2008 losses by October 2010, in contrast with global equities which are not expected to recover their financial crisis losses until at least 2015.

Other highlights from the Roadmap to Hedge Funds include:

  • Long-term performance - A hypothetical investment in the S&P 500 Total Return Index of $100 at the beginning of the last decade stood at $121 by August 2012, while a hypothetical investment of $100 in the HFRI Fund Weighted Hedge Fund Index stood at $201.
  • Downside protection – Hedge funds continue to demonstrate an ability to protect capital in periods of considerable market stress. Managed futures funds are found to have delivered a positive return in 18 out of 20 equity down-markets between 1980 and 2012. Even in the 10 worst quarters since 1990, a diversified hedge funds portfolio preserved capital better than a global equities portfolio.
  • The institutionalisation of the hedge fund market - Pension funds in particular are seeking hedge fund investments to diversify equity/bond portfolios and deliver superior risk adjusted returns. In response, hedge funds have become more transparent, better governed and better understood by institutional investors.
  • The case for active managers - While many aspects of hedge fund investing have changed since 2008, the concept of active risk management has not. In fact, the case for active risk management has increased over the past four years.

The original edition of the Roadmap to Hedge Funds was published in 2008, and was the world’s first collaborative educational guide for institutional investors in hedge funds. It de-mystified the industry by tackling misconceptions. It offered guidance on creating and managing a hedge fund portfolio and gave an in-depth view of hedge fund strategies, valuation, leverage, liquidity and risk management.

The updated Roadmap to Hedge Funds was also authored by Alexander Ineichen, founder of Ineichen Research and Management (IR&M).

Andrew Baker, AIMA’s CEO, said: “AIMA has always worked closely with the investor community to promote greater understanding of hedge funds. We are not pretending that the last four years have been easy for the industry, but if anything in difficult times like this the case for assets to be actively managed by specialised managers with a variety of tools at their disposal is even more compelling.”

Anita Nemes, Global Head of Capital Introduction at Deutsche Bank, said: “Not only has the hedge fund industry undergone a rapid transformation over the past four years, but attitudes to hedge fund investing have changed just as much. An increasingly institutional investor base brings with it a new set of client demands, including greater transparency and improved reporting and risk management. The Roadmap to Hedge Funds provides the analysis and voice behind these fundamental changes to the industry.”

Alexander Ineichen, founder of IR&M, said: “The main differentiation between hedge funds and traditional asset management is risk management. Over the past four years an active risk management stance has resulted in a reduction of risk. The reason for more conservative risk taking is mainly a rise in uncertainty related to artificially enhanced asset prices and other forms of intervention. The modest returns of hedge funds over the past four years are a direct result of taking less risk. In essence, hedge funds have done what they are designed to do, which is take risk off the table when uncertainty rises.”


- Ends –

For media enquiries, please contact

AIMA:
Christen Thomson, Director of External Affairs.
Tel: +44 (0)20 7822 8380; Email: cthomson@aima.org

Deutsche Bank:
Nick Bone
Tel: +44 (0)20 7547 2603; Email: nick.bone@db.com

IR&M:
Alexander Ineichen, CFA, CAIA, FRM
Tel: +41 41 511 2497; Email: ai@ineichen-rm.com


Notes for editors

The new Roadmap to Hedge Funds can be downloaded here: http://www.aima.org/download.cfm/docid/E9031A27-E978-4009-85EA1A8D325DAF7D

About AIMA

As the global hedge fund association, the Alternative Investment Management Association (AIMA) has over 1,300 corporate members (with over 6,000 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. They all 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.
 

 
 
Back to Listing

Main Menu

  1. Home
  2. About
    1. Our Core Objectives
    2. AIMA's Policy Principles
    3. Meet the team
    4. AIMA Council
    5. Global Network
    6. Sponsoring Members
    7. Global Partners
    8. FAQs
    9. Opportunities at AIMA
  3. Join AIMA
    1. Benefits of Membership
    2. Membership Fees
    3. Application form
  4. Members
    1. AIMA DDQs
    2. AIMA Annual Reports
    3. AIMA Governance
    4. AIMA Logo
      1. Policy note
    5. AIMA Members' List
    6. AIMA Review of the Year
    7. Committees and Working Groups
    8. Weekly News
    9. Update Profile
  5. Investors
    1. AIMA Investor Services
    2. AIMA Members' List
    3. Investor Steering Committee
    4. Update Profile
  6. Regulation
    1. Asset Management Regulation
      1. EU Asset Management Regulation
        1. AIFMD
        2. European Capital Markets Regulation
        3. MiFID / MiFIR
        4. UCITS
        5. European Venture Capital Directive
        6. Shareholder Rights Directive
        7. European Long Term Investment Fund Regulation
        8. Loan Origination Funds
        9. Capital Raising
        10. AIFMD-Related Events
      2. US Hedge Fund Adviser Regulations
        1. Registration and Reporting
        2. Incentive-Based Compensation
        3. JOBS Act
      3. Asia Pacific Asset Management regulation
      4. Other Jurisdictions’ Asset Management Regulation
      5. Systemically Important Financial Institutions ('SIFIs')
      6. Remuneration
        1. UK
        2. United States
        3. CRD IV and CRR
        4. AIFMD
        5. MiFID
      7. Shadow Banking
      8. Volcker Rule
      9. Other
      10. Systemic Risk Reporting
      11. Dealing Commission
      12. Corporate Governance
      13. Securitisation
    2. Markets Regulation
      1. Bank/Capital Regulation
        1. Capital Requirements Directive
        2. EU Bank Structural Reforms
      2. Derivatives/Clearing
        1. EMIR
        2. MiFID II / MiFIR - Derivatives
        3. MAD / MAR
        4. Dodd-Frank Act Title VII
        5. Hong Kong
        6. IOSCO
        7. Singapore
      3. High Frequency Trading
        1. EU automated trading
          1. ESMA Guidelines
          2. Germany
          3. MiFID II / MiFIR - HFT
        2. US automated trading
          1. SEC Regulation SCI
          2. CFTC Automated Trading
        3. IOSCO
        4. Flash Crash
      4. Insurance Regulation
        1. Solvency II
      5. Market Abuse
        1. MAD / MAR
        2. Indices as Benchmarks
      6. Position Limits
        1. MiFID II - Commodities
        2. CFTC Position Limits
      7. Resolution of Financial Institutions
        1. Europe
          1. EU Bank Recovery and Resolution Directive
          2. EU Non-Bank Recovery and Resolution
        2. CPSS-IOSCO
        3. Financial Stability Board
        4. UK
        5. USA
      8. Shadow Banking
        1. International Shadow Banking
        2. EU Shadow Banking
      9. Short Selling
        1. EU Short Selling Regulation
        2. Hong Kong Short Selling Regulation
        3. US Short Selling Regulation
        4. Short Selling Bans
        5. Securities Settlement
      10. Trading
        1. Dodd-Frank Act
        2. MiFID Portal
    3. Tax Affairs
      1. Automatic Exchange of Information (AEOI)
        1. FATCA
        2. EU - AEFI
        3. OECD - Global Standard on AEFI
      2. Australia - Investment Manager Regime (IMR)
      3. Base Erosion - Profit Shifting (BEPS)
      4. FAIFs and FINROFs
      5. FIN 48 and IAS 12
      6. Financial Transaction Tax (FTT)
      7. UK Investment Management Exemption (IME)
      8. UK Offshore Funds Regime
      9. Other
    4. AIMA's Policy Principles
    5. Search
    6. Resources
      1. Guidance Notes
      2. Jurisdictional Guides
      3. Noticeboard
        1. AEOI: FATCA and other regimes
        2. AIFMD
        3. BEPS
        4. CFTC Registration and Exemptions
        5. Corporate Governance
        6. Dealing Commission
        7. Derivatives
        8. FTT
        9. High Frequency Trading
        10. MiFID / MiFIR
        11. Other Hot Asset Management Topics
        12. Other Hot Markets Topics
        13. Other Hot Tax Topics
        14. Position Limits
        15. Trading
        16. UCITS
        17. UK Partnership Tax Review
        18. US State and Local Taxes
        19. Volcker Rule
      4. Hedge Fund Manager Training
      5. Quarterly Regulatory Update
      6. Webinar Programme
      7. Regulatory Compliance Association
        1. About the Regulatory Compliance Association
        2. RCA Curricula and initiatives for alternative investment firms
        3. Meet the regulators and Sr. Fellows
  7. Education
    1. Research
      1. AIMA Research
      2. Industry research
      3. Search research documents
    2. "The Case for Hedge Funds"
      1. Global Hedge Fund Industry Paper: The value of our industry
      2. The Value of the Hedge Fund Industry to Investors, Markets and the Broader Economy: Research commissioned by AIMA and KPMG
      3. The Evolution of an Industry: KPMG/AIMA Global Hedge Fund Survey
      4. Contributing to Communities: A global review of charitable and philanthropic activities by the hedge fund industry
      5. Beyond 60-40: The evolving role of hedge funds in institutional investor portfolios
      6. The Cost of Compliance: Global hedge fund survey by AIMA, MFA and KPMG
      7. Capital Markets and Economic Growth: Long-term trends and policy challenges
      8. Apples and Apples: How to better understand hedge fund performance
      9. The Extra Mile: Partnerships between hedge funds and investors
      10. Key articles by AIMA on the case for hedge funds
    3. AIMA Journal
      1. Recent issues
      2. Search AIMA Journal articles
      3. AIMA Journal Archive
    4. AIMA Guides to Sound Practices
    5. AIMA guides for institutional investors
    6. CAIA Association pages
      1. Fundamentals of Alternative Investments
    7. Regulatory Compliance Association pages
      1. About the Regulatory Compliance Association
      2. RCA Curricula and initiatives for alternative investment firms
      3. Meet the regulators and Sr. Fellows
    8. Certified Investment Fund Director programme
    9. Services to Start-up Managers
    10. Useful Websites
    11. Glossary
  8. Events
    1. AIMA Events
    2. AIMA webinars
    3. Industry events
  9. Media
    1. Press Releases & Statements
    2. AIMA's blog
    3. Media Coverage
      1. Articles by AIMA
        1. Archive
      2. AIMA in the news
      3. Video interviews
      4. Industry news
    4. Media Contact
    5. Press Materials