Interview with Jonathan Planté, Director of Business Development, Innocap…
By Abali Hoilett & Benoit Sansoucy, Maples – Canadian institutional investors have been at the forefront of investing in the alternative investment space, utilising innovative bespoke structures that reduce operational and investment risk and enhance returns. The widespread adoption of managed account platforms (“MAPs”), which create optimal conditions to generate and preserve alpha, while mitigating the risk from investing in commingled structures, has seen the vast majority of Canadian institutional investors engage a managed account platform provider (“MAPP”).
Demonstrating control in a crisis (again): How Covid-19 has reaffirmed the hedge fund allocator shift to dedicated managed accounts
By Joshua D Kestler, Global Head of HedgeMark, BNY Mellon – In the 12 years since the 2008 financial crisis, many large institutional investors have adopted Dedicated Managed Account (DMA) structures in order to address the challenges in commingled hedge funds that were exposed during the crisis. These investors were well-prepared to more effectively manage their portfolios through the market volatility which has resulted from the Covid-19 pandemic while eliminating many of the structural risks that can be exacerbated during a crisis scenario.
BNY Mellon HedgeMark is a dedicated managed account provider, solely focused on creating and operating managed account platforms for institutional investors. Launched in 2012, the business today has more than USD23 billion in assets across more than 100 funds spanning a broad range of hedge fund strategy types, including long/short equity, macro, equity market neutral, credit, CTAs, risk premia and more.
Innocap, the Montréal-based structuring and operating managed account platform unit co-owned by BNP Paribas and Caisse de dépôt et placement du Québec, was originally established in 1996 as the internal managed accounts-based fund of hedge funds within National Bank of Canada’s Treasury operations. Since then, the Innocap group has grown and now manages approximately USD7.2 billion in assets, structuring and operating customised managed account solutions for institutional investors globally.
For all the attendant challenges facing hedge funds – from greater fee pressures and more onerous compliance burdens to lacklustre performance and investor aversion – the industry has time and again demonstrated its ability to continually innovate and reshape the way it does business.
LumX Asset Management has been at the forefront of developing innovative alternative investment solutions for more than 25 years. One of the central tenets of its business model is its structured funds platform and structuring business, LumMap, designed to give a highly tailored solution to fund managers and investors, with strong governance, risk controls and deep position-level transparency thanks to its affiliation with LumRisk, an independent subsidiary of the LumX Group.
Since 2012, K2 Advisors, one of the industry’s largest hedge fund advisory groups, has been part of Franklin Templeton Investments. It has, in many ways, been an ideal marriage, with K2 bringing alternative fund solutions expertise and Franklin Templeton bringing a distinguished history in traditional registered investments.
The demand among institutional investors for managed account solutions continues to evolve, as they seek out new structuring solutions and vehicles to meet their investment return, liquidity, transparency and jurisdictional needs.
By Andrew Lapkin – Institutional investors are increasingly shifting their hedge fund investments from traditional, commingled structures to Dedicated Managed Accounts (DMAs). A DMA is a customised single investor hedge fund with portfolio assets ultimately owned (and controlled) by the investor. One of the most attractive benefits of DMAs is the opportunity to utilise the DMA structure to achieve “structural alpha”. Structural alpha is the ability to enhance returns by taking advantage of the unique structural aspects of a DMA. There are several ways that investors achieve structural alpha through a DMA structure.