Ninety-three percent (93%) of institutional investors plan to maintain or increase their hedge fund allocations in the second half of this year, according to the latest survey released by Credit Suisse.
Robert Leonard, Managing Director and Global Head of Capital Services at Credit Suisse said, “Despite ongoing volatility in the global marketplace, institutional investors remain steadfast in their approach to hedge fund allocations.”
Leonard noted the increased interest of institution investors around multi-strategy funds, which demonstrates their reaction to the fast-changing investment environment.
Hedge Fund Investor Sentiment Survey
According to Credit Suisse, more than 200 global institutional investors participated in the Hedge Fund Investor Sentiment Survey. The participants in the survey account almost $700 billion in hedge fund investments.
The survey showed that a majority of institutional investors favored Global Macro strategy at the beginning of the second half of this year. Their interest in Event Driven and Equity Long/Short strategies are still high.
Based on the survey, Global Macro (46%) remained the top strategy preferred by institutional investors. It is the only strategy included in the top three investor preferences in all regions. The strategy is popular due to its ability to capitalize on macroeconomics opportunities such as the potential increase of interest rates by the Federal Reserve.
The second most popular investment strategy among institutional investors is Event Driven (44%). The Equity Long/Short strategy (43%) climbed to the third position.
The interest of institutional investors in CTA/Managed Futures declined significantly from third to ninth place due to the increasing concerns about China;s economy.
During the first six months of 2015, institutional investors were actively invested in traditional Master/Feeder (Onshore/Offshore) structure, Managed Accounts and UCITS funds. The survey found that investors currently have a strong interest in UCITS, Managed Account products, and Co-investment structures for Equities.
Institutional investors’ top three investment strategies by region
Based on the results of the survey, the top three preferred investment strategies of institutional investors by region are the following
- Equity Long/Short (56%)
- Event Driven (47%)
- Global Macro (38%)
- Global Macro (54%),
- Equity Long/Short (46%)
- Event Driven (43%)
- Global Macro (44%)
- Multi-Strategy (44%)
- Credit Long/Short (39%)