23/11/2011 Author: Will Wainewright

Fauchier FoHF sees pension inflows increase this year

Fauchier Partners, the $8bn fund of hedge funds (FoHF), has seen inflows of more than half a billion dollars from pensions funds in the last year, despite recording slight performance losses, HFMWeek can reveal.

Alex Dolbey, partner at London-based Fauchier, said the inflows had come from both public and private pensions looking for diversification in a volatile economic environment.

Losses of 3% in the year to August led to Dolbey, together with fellow partner Christopher Fawcett, being called to report in September to Brent Council’s pension committee, who hold a $64m investment in Fauchier worth 8.8% of its £460m ($738m) portfolio.

The London borough’s head of exchequer and investment, Martin Spriggs, told HFMWeek the pension was “sticking with” Fauchier, but admitted that the FoHF’s performance was being monitored.

“They are a very good fund of hedge funds manager with whom we have a long relationship, but they have had a tough 18 months of performance and are looking to improve it,” said Spriggs.

Fauchier’s YTD performance of -3% to 31 August seems healthier when compared with the average hedge fund’s YTD loss of -5.26%, according to HFR data.

“We look to preserve capital in all market environments so we are as disappointed as Brent that we are marginally down this year,” said Dolbey, who added that losses had moderated to -1% in the 12 months to 31 October. Previous attempts by Fauchier to improve performance included the removal of “overly conservative managers” and the appointment of credit managers, according to documents seen by HFMWeek.