Purpose-Built Modern Tools for Hunting Alpha

  • Source: Liquid Holdings Whitepaper
Purpose-Built Modern Tools for Hunting Alpha
I. Attracting AUM: Process & Transparency

Historically, two primary criteria have factored into hedge fund managers’ ability to attract new assets: performance and pedigree. Today, those criteria have expanded as hedge funds face new industry challenges such as changing fee models, crowded markets, and new regulations, as well as investor mandates for transparency and operational credibility.

As detailed in Ernst & Young’s 2012 investor survey, “hedge funds still believe recent investment performance is important more often than investors do, and although investors clearly look at past performance, confidence in the people and in the processes that will generate future returns and manage risk-taking, respectively, are at least as equally important.”

For small businesses and especially hedge funds, competing for new clients and fresh capital requires the longest operating runway possible. Aside from a track record of performance, longer operating runways build client confidence in the team and the processes in place to manage operations

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