Hedge Fund Investors Research
Investors Investigating Hedge Funds More Thoroughly Today
"I'm not a conference room type of guy," sniffed Chelo, director of research for Tacoma, Washington-based Benchmark Plus, a $1.8 billion so-called fund of hedge funds that invests money with 25 managers. "It's very easy for people to fake it for two hours in a conference room, but it's a lot more difficult if you are at their desk going through their portfolio."
Chelo, 39, typifies the new, harsher reality facing the $1.9 trillion hedge fund business. In the aftermath of the industry's generally terrible performance during the financial crisis, institutional investors such as pension funds, university endowments and non-profit groups are far more finicky about where they put their dollars.
These newly-empowered investors are increasingly demanding -- and receiving -- a cut in fees, as well as provisions that require managers to meet certain performance goals and provide greater flexibility to ditch a fund if it flounders. And like Chelo, they are also doing a lot more snooping around before writing a check. Source