23/06/2010 Author: Shannon Hawthorne

Foundations still active in hedge fund space

Nearly two-thirds of US foundations are actively investing into the hedge funds sector, while a further 4% are considering making their first foray into the space within the next 6-12 months, according to recently published research by Preqin.

A recent study of 247 US foundations found that 64% are currently investing in hedge fund strategies, with an average allocation of 14.5% of total assets, compared to a mean target allocation of 16.3%.

Funds of hedge funds (FoHFs) were revealed to be the most popular way of allocating to the sector, with 80% of US foundations opting to invest doing so either through both FoHFs and single managers, or solely via FoHFs.

For those investing directly, a diversified approach to investment emerged as the most common, while long/short equity, macro and CTAs also proved to be popular strategies.

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