Prominent UK hedge fund investor warns on Ucits risks

One of the UK's most prominent investors in hedge funds says Ucits funds can carry similar risks to unregulated products, despite the regulatory imprimatur.

Matteo Perruccio, chief executive of Hermes BPK Partners, which runs the BT Pension Scheme's $1.4bn fund of hedge fund allocation, says some investors may not realize, or appreciate the dangers in regulated long/short vehicles. Instead, he says, they may take the regulatory status of Ucits as confirmation these vehicles are less risky. Perruccio says: "While certain hedge fund strategies sit comfortably within the Ucits framework - for example those that are liquid and less complicated - as soon as you move into less liquid and more complex strategies, particularly where returns are s...