Aberdeen Commonplace targets women-led hedge funds with new technique

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Aberdeen Commonplace Investments, certainly one of Europe’s largest asset managers, is ready to launch a fund investing solely in hedge funds run by ladies, assembly demand from traders who’re eager to foster range in a male-dominated business and from those that imagine larger range results in higher returns.

The brand new fund will monitor the efficiency of an index of women-run hedge funds, constructed by information supplier HFR, and goals to capitalise on rising curiosity amongst US pension plans and different traders choosing asset managers based mostly on environmental, social and governance standards.

The transfer comes in direction of the tip of a robust yr for women-led hedge funds relative to the general business, after many had been in a position to restrict losses throughout March’s market turmoil. HFR’s Girls Entry index is up 6.9 per cent this yr to the tip of October. That compares with a 1.1 per cent rise within the broader HFRI 500 Fund Weighted Composite index.

“Traders are being accountable traders all through the funding chain,” stated Petra Dismorr, chief government of ESG consultancy Northpeak Advisory, which works with fund corporations. Numerous US state pension funds have issued devoted mandates to allocate cash to companies owned by minorities and ladies, and different traders are more and more searching for extra range of their fund managers, she added.

Among the many women-led hedge funds which have carried out nicely are Catherine Nicholas’s Nicholas US Fairness Alternatives fund, which has gained round 23 per cent this yr, and Lan Wang Simond’s Mandarin Offshore fund, up round 24 per cent, based on numbers despatched to traders. Ms Simond’s fund was helped by cushioning itself towards the March tumult and by positions in know-how shares.

Lan Wang Simond © Pictet Group / JB Bouleau

Leda Braga, one of many business’s highest-profile figures, has gained simply over three per cent in her flagship Systematica fund to this point this yr, stated an individual conversant in its efficiency. That compares with a mean 2.6 per cent fall amongst computer-driven funds that wager on market traits.

Whereas many traders have targeted on altering company behaviour on the corporations they maintain shares in, there’s additionally a rising transfer amongst traders to drive change on the corporations that handle their cash. The proportion of ladies working at hedge funds, at just below 19 per cent, is the second-lowest throughout seven different asset lessons, based on a examine by information group Preqin. That’s up solely barely since 2017.

Final month David Swensen, chief funding officer at Yale’s endowment fund, wrote to its exterior funding managers to recommend methods of accelerating range of their entry-level jobs and to ask them to finish an annual survey on the problem.

“Our purpose is a stage of range in funding administration corporations that displays the variety on this planet wherein we stay,” Mr Swensen wrote within the letter on October 2.

Aberdeen Commonplace’s fund is a part of a collection of merchandise it’s launching, that may let shoppers spend money on round 30 totally different classes of Cayman-based hedge funds, cut up by technique or theme, or in a wider basket of 500 funds.

Early final yr the agency launched a portfolio monitoring the efficiency of 140 Europe-based hedge funds, elevating round $400m. It has amassed an extra $180m for a technique monitoring the efficiency of computer-driven trend-following hedge funds.

The launches spotlight how the massive development of passive investing — which has pushed belongings in change traded funds and merchandise to $6.8tn globally as on the finish of October, based on ETFGI — is reaching even hedge funds, lengthy thought-about the epitome of energetic funding administration.

Monitoring the efficiency of an index of hedge funds is extra difficult than replicating an index of shares, because the fund supplier has to continuously add or scale back holdings with underlying managers, a few of whom could have more durable phrases on withdrawals relying on flows into or out of its personal fund.

laurence.fletcher@ft.com

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