Hedge Fund Investor Opinions on Their Investment Consultants

by Dami Sogunro

  • 27 Oct 2011
  • HF

Preqin analysts recently carried out a survey of alternative asset investors, which included several active investors in hedge funds. They were asked to rank the performance of their consultant on certain aspects of the services they provide, ranking them from excellent to poor.

Seventy-two percent of hedge fund investors feel that their consultant has provided an above average or excellent service when it comes to fund selection, with none rating their consultant as a poor performer and only 5% stating their consultant was below average in this area. An even higher percentage (78%) of hedge fund investors feel that their consultant provides an excellent or above average service when providing access to top-tier hedge funds, with only 2% of investment consultants rated as poor in terms of this. Seventeen percent of consultants were rated as average.

As a result of current market conditions, 39% of hedge fund investors stated that their consultant had advised an increase in their level of hedge fund investment, 59% advised that there should be no change in their level of investment activity and only 2% stated there should no new investments made. None of the respondents stated that their consultant had advised them to reduce their total hedge fund allocation.

Further results and analysis also show that overall, hedge fund investors see their investment consultants in a positive light, with a greater proportion of hedge fund investors rating their consultant as excellent or above average in several aspects of the services they provide. However, when it comes to providing accurate market predictions consultants were rated less favourably, with 52% considered to be average or below average.

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