Blackstone Alternative Investment Advisors (BAIA), an affiliate of Blackstone’s hedge fund solutions business, will be closing the Blackstone Alternative Multi-Manager Fund (BXMMX), the smaller of its two mutual fund products.
Blackstone launched BXMMX in August of 2013 as a dedicated vehicle for Fidelity Investments. As of 31 March, 2016, the AUM of BXMMX was USD631 million. Blackstone will liquidate the fund on or before 31 May, 2016.
BXMMX sought capital appreciation through a diversified global set of exposures, traded by alternative asset managers, which demonstrated relatively low beta to traditional markets and produced attractive risk-adjusted performance. BXMMX is operated as a USD mutual fund under the Investment Company Act of 1940.
Blackstone noted that BXMMX delivered strong risk-adjusted returns since its launch through 31 March, 2016, capturing approximately 66 per cent of the performance of global equities (as measured by the MSCI ACWI Index1) with approximately 37 per cent of the volatility. In addition, the cumulative return of BXMMX outpaced the broader hedge fund industry over this same period by 12.4 per cent net of fees and expenses (as measured by the HFRX Global Hedge Fund Index). Additional information and current performance data is available here.
Given significant investor demand for this type of exposure, Blackstone built a global registered fund platform that offers liquid investment solutions. This platform currently has approximately USD6.8 billion in AUM, including USD5.9 billion in solutions that offer daily liquidity. The largest fund on this platform is an alternative mutual fund that has an investment objective that is identical to the objective of BXMMX. This fund, Blackstone Alternative Multi-Strategy Fund (“BXMIX”), has experienced significant demand across a broad investor base and has grown to approximately USD4.3 billion since its launch in June of 2014.
Blackstone has allocated significant resources to facilitate the continued growth of this platform. This includes a dedicated investment committee that is responsible for ongoing investment, asset allocation, and oversight of all of BAIA’s registered funds. Consistent with its historical approach to team-based portfolio management, Blackstone will designate each of the members on this investment committee as portfolio managers of the Blackstone Alternative Multi-Strategy Fund.
