Hedge Funds Are Hiring
The outlook appears bright for hedge funds in 2008. The Hennessee Group estimates that its Hennessee Hedge Fund Index advanced 11.6% in 2007. Looking ahead, interest in the asset class by institutional investors is expected to grow. The Lipper Hedge Fund Survey shows that institutional investors will account for an increasing percentage of hedge fund managers’ client base over the next three years.
Looking ahead, executive search firm, A.E. Feldman, reports that hedge funds, which manage to sidestep the credit crunch, will be raising more capital and expanding their ranks in 2008. Investment and risk professionals are among those in demand. In addition, attorneys with corporate experience can turn to hedge funds that are scrambling to hire in-house lawyers to address increasing regulatory pressures.
The hedge fund industry had the best year relative to the S&P since 2002, says the Hennessee Group. ”Despite several high profile hedge fund failures, performance for the industry as a whole was excellent in 2007,” said E. Lee Hennessee, Managing Principal of Hennessee Group.
Chasing higher returns, institutional investors will account for an increasing percentage of hedge fund managers’ client base over the next three years, according to the Lipper Hedge Fund Survey. Results show that 64% of respondents estimate institutional investors will account for 30% of hedge fund managers’ client base. Another 38% of respondents put that number at 50%. More than half of those polled, 56%, say pension funds should allocate at least 11% of assets to hedge funds.
According to Pensions & Investments, hedge fund investment by some of the pension funds at the top of P&I’s hedge fund ranking skyrocketed in the year ended Sept. 30. The Pennsylvania State Employees’ Retirement System is the largest hedge fund investor with $10.6 billion. Sacramento-based California Public Employees’ Retirement System’s assets jumped 66.5% to $6.2 billion. Albany-based New York State Common Retirement Fund’s hedge fund allocation increased 43.6% to $5.4 billion and the hedge fund investments of Massachusetts Pensions Reserves Investment Management Board grew to $5 billion, up 65% from a year ago.
A.E. Feldman reports that hiring in the hedge fund industry continues as assets under management increase. Hedge fund jobs are opening up for alternative investment professionals who have a comprehensive understanding of the risks and benefits of the various asset classes and investment strategies.
