ARLINGTON, Va. — Institutional investors can't get enough of hedge fund investment, based on audience polling at the two 2005 National Strategic Investment Dialogues held by funds-of-funds manager Strategic Investment Group.
A total of 70 senior executives from institutional investors, consultants and money management firms, controlling a collective $700 billion, convened in May in Washington and in October in San Francisco to discuss "Absolute Returns, Relative Risks: The Changing State of the Art in Strategies for Investing in Hedge Funds."
The largest section of the attendees at both events — 37% — said they had been invested in hedge funds for more than 10 years. Interestingly, more of the San Francisco crowd, 41%, said they'd been in hedge funds for more than a decade, compared with about 31% of the Washington audience. Sixteen percent of respondents at the two gatherings said they had been invested in hedge funds for between five and 10 years, 26% had invested for two to five years, and 21% had used hedge funds for less than two years.
But more importantly, the polling data also revealed that many NSID workshop attendees intend to significantly increase their hedge fund allocations in the next decade. In the next three to five years, 15% of attendees expect to have more than 30% of total assets in hedge funds; 28% expect between 20% and 30%; 31% expect between 10% and 20%; 17% expect between 5% and 10%; and 9%, less than 5%.