Aberdeen Standard Investments (ASI) is launching a fund of alterantive Ucits funds for institutional investors, offering a passive way to gain exposure to a diverse range of hedge fund strategies.
The ASI HFRI-I Liquid Alternative Ucits Strategy is being seeded with $150m of institutional investor money. It will invest in over 140 Ucits funds, mirroring the constituents and weightings of the HFRI-I Liquid Alternative Ucits Index which in aggregate has assets of more than $110bn. The fund offers diversification across Macro, Relative Value, Event Driven and Equity Hedged strategies.
ASI cites a EuroHedge report that institutional investors make up some 59% of the $3.6trn hedge fund industry, but so far have not had much opportunity to access the asset class through passive investments - despite the flows seen to equity and fixed income markets.
Russell Barlow, global head of Alternative Investment Strategies, said: "The risk-return features of hedge fund strategies appeal to institutional investors seeking to diversify portfolios and meet specific financial objectives. Although we have seen a proliferation of passive products across traditional asset classes, such as equities and bonds, to date this hasn't been a viable option for those allocating to alternatives. The rationale for offering this capability is clear; clients are looking for a broad array of access routes to hedge funds and passive is now one of the number of options ASI offers to meet these needs. By working with HFR, the go-to provider of hedge fund index information, we are now able to provide institutional investors with exposure to a benchmark profile for the asset class."