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Portfolio > Alternative Investments > Hedge Funds

Index Fund Attracts More Than Half a Billion Dollars

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NEW YORK (HedgeWorld.com)–Investment vehicles linked to the CSFB/Tremont* Investable Hedge Fund Index, including principal guaranteed notes, received more than US$500 million of capital in less than three months.

“We are just beginning,” said Oliver Schupp, president of CSFB Tremont Index LLC. He sees a growing trend toward index investing.

Industry observers expect large inflows into indexes this year, in particular from institutions new to hedge fund investing but familiar with the general index approach .

“The swift accumulation of investments through index-linked products demonstrates the importance of indexes as a tool for gaining access to a diversified spectrum of hedge funds through a single investment,” commented Anthony Pesco, head of the Fund-Linked Products Group at CSFB, in a statement.

Several other firms, including MSCI and Standard & Poor’s, have introduced hedge fund index funds in the past year or so.

The core CSFB/Tremont fund was launched in October last year, after an investable index was introduced. Based on the long-standing CSFB/Tremont benchmark, it allocates to 60 managers across 10 strategies–typically to the largest funds in each strategy segment of the index, provided these are open to investment and meet certain liquidity conditions .

*Tremont Capital Management Inc., Rye, N.Y., is a strategic partner of and a minority investor in HedgeWorld.

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