A year ago, Measurisk LLC Vice Chairman Kelsey Biggers said hedge fund risk reporting would be the next big boon for the risk industry.
Today, instead of waiting for hedge funds to come to Measurisk, Mr. Biggers is going to the hedge funds.
This month Mr. Biggers will leave Measurisk, the firm he helped found in 1999, to join K2 Advisors, a $1 billion fund of hedge funds firm in New York. Among his top priorities will be helping the firm establish itself as a leader in hedge fund transparency, something Mr. Biggers sees as pivotal in attracting pension fund money.
"At Measurisk we've been working with funds of funds and increasingly understanding how important it is to get transparency," Mr. Biggers said.
Why is transparency so important? Hedge funds and pension funds are drawn to each other by mutual attraction. Pension funds want hedge fund returns and hedge funds want pension fund assets - and the management fees that come with those assets. But while pension funds like to know what they're investing in, hedge fund managers are notoriously tight-lipped about their investments.
Mr. Biggers said he thinks as a fund of funds K2 can play an important role in finding a middle ground. K2, he said, can use its relative size and its relationships with hedge fund managers to develop risk measurement systems that pension funds will accept and hedge fund managers will trust with proprietary information.
"I will be looking at helping them (K2) build on the platform they already have in risk processes," Mr. Biggers said. "I think we can build that into a leader in the fund of funds world."
