Niki Natarajan, editor, InvestHedge
The funds of funds industry, as represented by the largest
players with more than $1 billion or more in assets, has
entered a new paradigm. Transparency, fee alignments, leverage,
liquidity, fiduciary responsibilities, compensation, and
increased regulation are all on the agenda and likely to shape
the world of hedge fund investing going forward. Getting
investor sentiment for hedge funds back on side is considered
by the majority of the InvestHedge Billion Dollar Club survey
as one of the chief challenges for 2010.
Two years ago, 151 of the largest funds of funds in the
world had more than $1 trillion in assets under management.
This universe has shrunk in number by 25% since December 2007
and is currently home to 114 firms with $625 billion in assets
at 31 December 2009, equivalent to 43% less under management
than two years ago.
Although the largest players in...