Swiss-based Alix Capital, provider of the UCITS Alternative Index has found its latest UCITS Alternative Index Industry Survey Q1 2012 that the majority of investor respondents are wi
Swiss-based Alix Capital, provider of the UCITS Alternative Index has found its latest UCITS Alternative Index Industry Survey Q1 2012 that the majority of investor respondents are willing to increase their allocations to CTA, Market Neutral and Volatility strategies. Some 45 respondents took part in the survey, 62 per cent of who were classified as fund investors (FoFs and Investors). Approximately 58 per cent said they would consider increasing their allocation to CTA strategies in Q1, whilst 48 per cent favoured Market Neutral and Volatility strategies. Interestingly, Fixed Income recorded the highest reduction intention, with 29 per cent of respondents saying they would likely reduce exposure, despite the strategy returning 4.15 per cent in 2010 and minimizing losses, in what was a tough 2011, to a respectable -0.80 per cent. Over 40 per cent said they would keep their allocations neutral.
Another revealing statistic to emerge in the report is that over two thirds (68.9 per cent) of respondents expect AUM in global UCITS hedge funds to continue growing in 2012, no doubt in response to tough market conditions and the increasing need to favour liquid, transparent strategies. Additionally, 40 per cent said they thought the introduction of the AIFM Directive would be positive for the growth of the alternative UCITS industry, whilst 18 per cent said there would be no impact as the two frameworks cover different investor categories (AIFMD relating to those who favour traditional offshore hedge funds).
None of the respondents believed that managers should offer alternative UCITS products exclusively but rather that, going forward, they must offer a combination of UCITS and non-UCITS hedge funds to satisfy the investor community. This would also tend to suggest that the trend of ‘co-domiciliation’ is likely to gather momentum as onshore markets such as Ireland and Luxembourg continue to grow.
