Institutions Want Infrastructure, Transparency

OAKS, Pa. (—The SEI Knowledge Partnership released a new white paper on “critical challenges for hedge funds,” especially focused on what institutions seeking investment opportunities want. The paper is based on a survey of institutions conducted early in 2007, drawing on the database of Infovest 21 LLC. The focus on “institutions” came about because that’s where the growth is and because of a broad understanding that institutions, even more than family offices or high-net-worth individuals, have become wary of the stereotypical “two men and a dog” hedge fund. The survey confirmed that wariness. In it, the SEI Knowledge Partnership found that the top criterion for institutions in selecting an asset manager is “infrastructure.” This broad term refers to such features as the independence of asset valuations, a big-name prime broker (either that or multiple prime brokers), adequate trading systems and platforms.

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