Demand for managers of hedge funds and other alternatives, along with non-U.S. equity, is expected to be high for the remainder of the year, experts say.
"There was very strong search activity for hedge funds from pension funds and endowments in the first half of the year, and we expect there will continue to be a lot of interest in the second half," said Barry Colvin, president and chief executive officer of Tremont Advisors, Rye, N.Y., a hedge-fund-of-funds manager.
"We expect to see more non-U.S. equity searches and more alternative investment searches in the second half of the year," said Yariv Itah, manager of research for Casey Quirk & Acito LLC, Darien, Conn.
Statistics from Mercer Investment Consulting's Tracker Database show assets committed to hedge funds during the first half of 2004 were more than double that of a year earlier, said Bob Stein, a consultant at Mercer in Louisville, Ky. There were 31 hedge fund hirings, totaling $2.5 billion, in the first half of 2004, up from 21 totaling $1.2 billion a year earlier.
On the international equity side, "we think the long-term trend … will see mandates carved up into style categories such as international value, growth and small cap, and away from international core mandates," Mr. Itah said. He also anticipates a "short-term tactical trend away from fixed-income investments because of rising interest rates."