Just 8% of European institutional investors have invested in EU-regulated onshore hedge funds set up as Undertakings for Collective Investment in Transferable Securities format, according to the results of a Preqin survey released today.
The February survey of 50 worldwide institutional investors found that despite the low investment rate, 35% were considering investing in UCITS-compliant hedge funds within the next six to 12 months. This figure includes investors from outside Europe, according to Preqin's report of the survey's findings.
Greater transparency was the most popular reason for investing in UCITS, with 41%; followed by liquidity, 22%; regulatory oversight, 22%; risk reduction, 11%; and other, 4%.
Among 60 worldwide hedge funds of funds also surveyed by Preqin in February, 28% already offer UCITS hedge funds and another 28% are setting up hedge funds using the UCITS format.
Just over half – 51% — of Europe-based hedge fund managers now offer UCITS funds and another 11% domiciled outside Europe provide UCITS funds. None of those managers is based in North America, according to Preqin's report. However, Preqin reported that five North American hedge fund managers said they are considering adding UCITS funds; Preqin did not identify these managers.
European managers that recently launched UCITS hedge fund platforms include Brevan Howard Asset Management, GLG Partners, Lyxor Asset Management, Investec, Thames River and Man Investments, Preqin reported.
