Cheeseman predicts further hedge fund covergence

Cheeseman says a number of hedge fund groups have begun to launch open-ended Ucits III vehicles, which provides retail investors with access to strategies previously only opened to professional investors.

"The emerging presence of hedge fund groups with proven competence in adding value through long and short trades, derivatives and with the effective risk management tools to manage such strategies is a welcome development," Cheeseman says.

"Historically retail investors have been very heavily exposed to general market movements and therefore the inclusion of some of these funds within diversified portfolios can help to reduce overall volatility."

Cheeseman is also predicting continued rationalisation, both at the corporate and fund level. He says this will partly be driven by the introduction of some offshore funds into IMA sectors.

"Despite market rises and an improving outlook for profitability, at the product level fund rationalisation remains on the agenda, driven by groups taking a more holistic view of their onshore and offshore fund ranges," he adds.

Categories: Hedge Funds | Fund of Funds

Tags: Ucits iii | F&c

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