Listed hedge funds and discounts

Investors should remember the advantages listed hedge funds have over traditional hedge funds, says Edward Cartwright of LGT Capital Partners

Back in the heady days of 2002 and 2003, wealth managers all over Europe, but especially in the UK, were looking for innovative ways to offer their clients exposure to hedge funds. They rapidly embraced new closed-ended investment companies launched by some of the world’s leading fund of fund managers and then, later, became even braver and bought offerings from single hedge fund managers using the same sort of investment vehicle. The advantages over traditional hedge funds were clear. Such companies could provide daily liquidity, as the shares tended to trade on a major stock exchange, ...