The process is designed to help institutional investors determine if their portfolios are positioned not only to deal with the realities of the investment landscape today, but also to meet specific future investment objectives. The video features Darren Spencer, director, alternative investment strategies, discussing the five key areas of a hedge fund tune up process: investment policy development, strategy allocation, manager selection, portfolio construction and risk management.
Spencer says clients can use the tune up process to:
- enhance portfolio structure by combining direct investments with fund of funds, allowing them to take advantage of particular manager skill sets
- enhance return potential by making better use of opportunistic strategies such as taking advantage of fiscal imbalances, divergent growth between developed and emerging economies, or the unwinding of central bank liquidity
- ensure they are using the hedge fund portion of a portfolio in the most optimal way, including considering options such as the use of separately managed accounts to improve transparency