UK - More than half of UK schemes have ruled out investing in hedge funds, research from JPMorgan Fleming Asset Management reveals.
The fund manager said 92% of the 171 schemes surveyed had never invested in hedge funds. Of the 157 schemes which had not invested in the asset class, 57% said they would not do so in the future.
But the study shows that nearly three-quarters of schemes considering investing in the asset class would do so through hedge fund-of-funds.
This is in stark contrast to the majority of existing hedge fund users which invest directly in the asset class.
JPMorgan Fleming co-head of institutional business, Stephen Hobbis, remained positive – despite the largely negative outlook for hedge funds.
He said: “Hedge funds are not going to be appropriate for every plan, but what is encouraging is the number of schemes that say they will consider it in the future, considering how little investment there currently is in hedge funds.”
The firm also found that private equity was far more popular with schemes than hedge funds, with 44% of respondents stating that they currently have money in the asset class.
Of the 96 schemes that have either stopped using or have never invested in private equity, 62% ruled out making any future investment.
JPMorgan Fleming’s research followed revelations that both the £26.5bn BT Pension Scheme and the £18bn Electricity Supply Pension Scheme have invested in hedge funds.
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