Traditional Money Managers
Traditional money managers ($1 billion + capital base):It is a proven fact that diversification across asset classes is critical to the success of any portfolio strategy. Hedge funds because of their flexible investment approach can offer the necessary diversification by minimizing the risks. The returns are designed to be uncorrelated to the stock markets down months (the reason for their appeal in the first place).
In difficult markets, a money manager’s best defense is to offer a proprietary fund of funds to their clients. In principal, fund of funds can offer more transparency and a higher level of risk management as the underlying funds provide an additional layer of hedging by working together to neutralize the portfolios market exposure.
A proprietary fund of funds should be designed specifically to compliment the long managers investment philosophy and style and offer the greatest diversification so it minimizes the client’s risk exposure and improves overall performance.
Working with both the long manager and the fund of funds manager, Hedgepros will:
- Introduce traditional money managers to experienced fund of fund managers with proven ability and track record so that they may take of advantage of this line extension strategy.
- Coordinate and guide the process of establishing a proprietary fund of funds.
- Manage the budget and administrative process of setting up both a domestic and offshore fund of funds. With Hedgepros guidance, the initial outlay to set up and launch two proprietary funds of funds should be a low-cost investment that can easily be recaptured in the fund of funds first year of business.