April 3, 2006

Swiss Fund Providers Off to Flying Start

BERNE, Switzerland (HedgeWorld.com)--The Swiss Fund Association has reported that domestic fund providers had total net inflows of 3.37 billion CHF ($2.58 billion) in February. Cumulative inflows for the first two months of the year reached over CHF 7.7 billion, and assets managed by Swiss fund providers now total over 588 billion CHF.

The losers, year-to-date, are money market funds and bond funds, with outflows of 819 million and 161 million CHF respectively, although bond funds did have a positive showing (+1.27 billion CHF) in February. Equities funds (+3.24 billion CHF), asset allocation funds (+1.24 billion) and real estate funds (+1.59 billion) all showed robust growth.

The main gains were in "other funds", up 5.79 billion CHF, or 19.5%, year-to-date. These are mainly composed of funds for alternative investments or those with a special investment policy, including hedge funds. The performance was boosted by the addition of a Switzerland-domiciled fund specializing in commodities investment. However, an SFA document notes that the size of this category is probably significantly larger, since "there are likely to be further considerable holdings (sic) in funds that are not offered publicly and therefore not covered by this statistic."

Assets in funds established under Swiss Law account for 187.9 billion CHF, or 34% of the total. Dr. Matth?us Den Otter, CEO of the SFA, told HedgeWorld: "Our statistics don't make distinctions as to where funds are domiciled, as long as they are managed by Swiss fund providers." He estimated that 60% of total assets under management are in funds domiciled in Luxembourg, while the remainder comes from funds domiciled in around 10 other jurisdictions.

Contact Bob Keane with questions or comments at bkeane@investmentadvisor.com.

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