Credit Suisse Asset Management (CSAM) has become the latest global asset manager to move into the direct management of hedge funds.
CSAM launched its Diversified Credit hedge fund last month and has so far raised $620m (€526m). CSAM also runs a fund of hedge funds and is currently reducing the number of managers in the fund.
Bob Parker, deputy chairman of CSAM, says that the aim is to provide a hedge fund product for pension funds and other institutional investors who are wary of hedge funds.
“A lot of clients are saying to us that they don’t want to invest in a hedge fund boutique because they don’t know it and they don’t understand it. That is why the big firms like ourselves are all setting up, in addition to funds of hedge funds, a separate unit which is directly managed.
“I think you’ll increasingly see large firms like ourselves who will shift away from the boutiques back to directly managed funds.”
Parker says that hedge funds should perform well in the medium term. “The market environment should be great for hedge funds if you buy the argument that equities trade sideways and we‘re not going to make much money out of bonds.”
Other large asset managers, notably UBS and Deutsche Asset Management, have also launched directly managed funds.