Funds of Hedge Funds Hedge Funds Performance

Do hedge fund copycats work?

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Assessing AlphaClone’s first year running virtual funds of hedge funds.

AlphaClone launched in 2008 with an ambitious idea: allow everyday investors to copy hedge fund returns without the high fees. By piggybacking on the publicly disclosed stock investments of nearly 300 hedge funds and other money managers, including Baupost’s Seth Klarman, SAC Capital Advisors' Steve Cohen and Tiger Global’s Chase Coleman, the San Francisco firm sought to give everyone access to the masters.

Besides research tools, the firm offers a variety of separate account strategies, charging flat management fees of 1% to 1.5% of assets. Those accounts allow clients to invest alongside managers practicing particular equity strategies, such as one,