Deutsche Bank publishes seventh annual Alternative Investment Survey
Approximately 1000 respondents, representing nearly $1.1 trillion in global hedge fund assets, participated in the industry’s largest comprehensive hedge fund investor survey
Deutsche Bank today announced the results of the seventh annual Alternative Investment Survey, which was conducted during February 2009 by the Bank’s Hedge Fund Capital Group. Approximately 1000 investors responded to this year’s survey, including funds of hedge funds, family offices, banks, wealth management companies, consultants, pensions, insurance companies, foundations, and corporations.
“Despite the unprecedented challenges faced in 2008, the survey indicates resiliency in the hedge fund industry”, said Barry Bausano, Co-Head of Global Prime Finance at Deutsche Bank.
“Transparency, risk management, and liquidity are now top priorities for investors as they select their hedge fund managers”, said Jonathan Hitchon, Co-Head of Global Prime Finance. “As a result, we have seen managers of various strategies adjust their structures accordingly.”
“Hedge funds remain attractive to investors due to their outperformance of major equity indices in 2008, and their ability to serve as a diversifier to other asset classes,” said Scott Carter, Head of the Hedge Fund Capital Group in North America. “Additionally, the survey indicates that a majority of investors expect their own hedge fund portfolios to generate returns of 5-10% this year.”
Highlights of Deutsche Bank’s Seventh Annual Alternative Investment Survey
- The US is predicted to be best performing region this year. Eastern and Central Europe and Russia are predicted to perform the worst.
- Transparency and Risk Management are now among the top 5 manager selection criteria. Historically, investors indicated the “3Ps Performance, Philosophy and Pedigree to be the most important characteristics when selecting a manager.
- 72% of hedge fund investors have reduced their exposure to leverage and 63% are not interested in applying leverage to their own portfolios this year.
- 43% of investors said they would be more likely to make a proportion of their investments through managed accounts in the future, citing liquidity, transparency and risk management benefits.
- Hedge fund investors are sitting on $294bn of cash and collectively expect to reduce this over the next 6 months to $212bn, if the markets remain stable.
- The larger funds continue to grow and a premier league of hedge funds is emerging: 50% of respondents said they plan to invest in hedge funds with an average AUM of $800mn - $4bn this year.
- Macro, CTA (Commodity Trading Advisor), and Equity Long/Short are predicted to be the best performing strategies. Merger arbitrage, event driven and asset-backed securities are predicted to be the worst performing strategies with investors going into 2009.
For further information, please call:
Renee Calabro +1-212-250-5525
About Deutsche Bank
Deutsche Bank <NYSE: DB> is a leading global investment bank with a strong and profitable private clients franchise. A leader in Germany and Europe, the bank is continuously growing in North America, Asia and key emerging markets. With 80,456 employees in 72 countries, Deutsche Bank competes to be the leading global provider of financial solutions for demanding clients creating exceptional value for its shareholders and people.
2009 Alternative Investment Survey