BRI Partners has launched the first in a new range of investable hedge fund indices designed to deliver the beta of hedge fund strategies – the BRI Long/Short Equity Index (BRILSE), calculated by Wilshire Associates.
BRI Partners has developed eight indices in total which will be rolled out over the coming months.
Unlike existing hedge fund indexes, the BRI Indexes do not measure the performance of hedge fund managers and, therefore, do not rely on managers to provide a snapshot of month-end results. Decades of economic and academic research are the foundation for each BRI Index, which are built from the risk factors used by hedge funds while avoiding the discretionary, behavioural and business risk of active funds.
Each BRI index provides efficient exposure to the same risk/return profile of hedge fund strategies, and does not require hedge fund managers to provide their monthly performance. They are all designed to serves as a true beta benchmark for performance of actively managed funds, and to assist investors and managers to identify and demystify alpha in active managers.
Adam Brass (pictured), founder of BRI Partners, says: “We have a singular objective to create a family of investable indexes that cost-effectively and efficiently deliver the true beta of alternative strategies. We do not measure hedge fund manager performance, rather, we have identified the risk factors used by hedge funds that measure their beta performance before their strategies seek to capture alpha. This measure provides investors and managers with a vital benchmark that has never been available until now. The timing could not be better.”
BRI Partners has aligned with Wilshire Associates to calculate the daily price of the index and bring that baseline investment strategy to market, made available at a cost that rivals most passive investments available today.
“We are proud to align with Wilshire to provide investors with the next generation of indexes, which will make it easier to quantify and demystify alternative strategies,” Brass adds. “Each index investment strategy made available will be low-cost, transparent, scalable and liquid.”
Robert J Waid, managing director at Wilshire Associates, says: “Wilshire Analytics is thrilled to help fuel yet another Powered by Wilshire index offering from BRI Partners. Wilshire’s calculation and analytical expertise combined with BRI’s innovative, proprietary systematic indexes demonstrate the value of a Powered by Wilshire approach which can help clients bring new investment benchmark strategy ideas to market quickly.”
