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Portfolio > Alternative Investments > Hedge Funds

New Survey Sees Growing Institutional Allocations to Hedge Funds

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LONDON (HedgeWorld.com)–Nearly half the institutional investors surveyed by Coller Capital said they planned to increase their allocations to hedge funds in 2005.

Although the survey deals primarily with private equity–Coller Capital’s specialty–the results show growing interest in alternative investments across the board, which could prove to be good news for private equity, venture capital and hedge funds.

Coller Capital’s Global Private Equity Barometer surveyed 105 private equity investors around the world in August and September. Slightly more than half, 56%, said they expected to increase their allocations to alternative asset classes in 2005. Forty-three percent said they would increase private equity allocations, and 45% said they would increase hedge fund allocations.

The results were consistent across the globe, Coller Capital officials said.

With respect to private equity specifically, Coller Capital’s survey found that 53% of all investors worldwide expected to increase the number of managers they employ in 2005. Among Asian investors, 62% said they would expand their manager rosters.

Continuity/succession issues and aggregate fund performance topped the list of factors influencing investors’ decisions to invest or reinvest with a particular private equity manager. More than 80% of respondents said those two issues were most important. The least important factors were apportionment of carry within the manager’s investment team and recommendations from other investors; fewer than 40% of the survey respondents cited those two factors as important in influencing their decisions.

Coller Capital specializes in secondary purchases of venture capital, mezzanine and buyout fund investments. Coller buys out the interests of investors who want to exit funds before their investments mature.

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Contact Bob Keane with questions or comments at: [email protected].


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