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December 19, 2005
Hedge Funds Reviewed
In the latest Lonsec’s hedge fund sector review, four funds have been recommended as upgrades and moreover there have been no downgrades in the review. Both long/short equity funds are excluded from the review.
According to a senior investment analyst at Lonsec, the market was strongly skewed in favor of higher ratings in the hedge fund sector compared with other asset classes the researcher reviews due to the small size of the market.
Lonsec reportedly upgraded the ratings on the CFS Global Diversified Strategies Fund to ‘recommended’, while the HFA Diversified Investments Fund, Rubicon M&A Fund, and the GSJBWere Global Alpha Fund were also rated in the review. The review also rated some of the first time rated funds such as GSJBWere Multi Strategy Fund, the UBS Global Alpha Strategies Fund, and the Select Gottex Market Neutral Fund. These aforesaid funds were marked at ‘recommended’ ratings. One more fund to make its rating debut was the Challenger FM Global Hedge Fund. The fund got an ‘investment grade’ rating.
The only hedge fund of funds to be rated as ‘highly recommended’ was the HFA Diversified Investments Fund. While all the four fund in the single manager hedge fund segment, which include the BGI Global Markets Fund, the Basis Aust-Rim Opportunity Fund, the Rubicon M&A Fund, and the GSJBWere Global Alpha Fund – achieved ‘highly recommended’ ratings. Meanwhile, five other funds received ‘recommended’ ratings, while two received ‘investment grade’ ratings.
According to analysts, numerous industry patterns and trends had been observed through the review process. The emerging trends include huge growth in hedge fund assets, which are driven by institutional demand and the institutionalization of various hedge funds of funds managers. This is potentially driven by the motive to attract institutional money.
Read More: Hedge Funds Upgraded Despite Slowing Market
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