Local institutions revive interest in hedge funds

Tue Sep 13, 2011

Foreign FoHFs battle for shares in a competitive market

"Swiss pension funds prefer to invest with local houses as it enables them to become better acquainted with the managers and gain a closer understanding as to how they operate"
Peter Hegglin, head of manager research, Mercer Consulting
Given their long history of allocating to alternative investments since the mid-1990s, many Swiss institutional investors are scarcely strangers to the hedge fund world. Over the past 15 years, corporate pension funds such as Nestlé, public bodies like the City of Zurich, and pension funds run by private banks that were managing their own hedge fund products, have pioneered a policy of diversifying risk by allocating to newer asset classes.

The presence of so many large FoHFs in Switzerland, which still represents around 30% of the global industry, has played a key role in pioneering this development. Swiss institutions have traditionally tended to maintain a bias towards domestic hedge fund providers, making the...

ISSN: 2151-1845 / CDC10004H

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