Outfox AQR? Hedge Funds Aim for New Path into Liquid Alts

FundFire article by Lydia Tomikaw with a quote from Andrew Beer:

…For hedge funds that haven’t performed well in recent quarters, any foray into liquid alternatives isn’t a priority, says Andrew Beer, managing partner at Beachhead Capital Management. New hedge fund players also face competition from early liquid alts entrants like AQR that have established a strong footprint. “AQR is unique – it has the scale of traditional asset management firm,” he says.

Those managers instead will try other tactics to enter the market, he says.

“I don’t expect hedge funds themselves to try and break into the space on their own. Maybe as a subadvisor, but the single manager products… is probably not a good idea,” Beer says.

…New hedge fund managers also can meet the demand coming from investors for the second generation of liquid alts products, Beer says.

“The liquids alts space will be looking for, in 2018, attractive products that are lower-cost and match and outperform hedge funds and can diversify away from the single-manager risk that has plagued some of the first-generation products,” he says.


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February 7, 2018