ASI initiates a platform to track investable hedge fund

By Rahul Vaimal, Associate Editor
  • Follow author on
Representational Image

The investment management company Aberdeen Standard Investments (ASI) has innovated a new platform to enable investors to track a wide range of investable hedge fund benchmarks for the first time.

The platform using its experience on the public market equity tracker model, where half of US equity assets are passively invested, developed the capacity for significant scaling as it looks to take a share of over $3 trillion hedge fund market and to attract new investors into the asset class.

With the establishment of the platform, ASI will be enabled to initiate products that track Hedge Fund Research Inc.’s (HFR) flagship investable index the ‘HFRI 500’; a fund weighted index comprised of 500 investable hedge funds across a broad range of strategies calculated and published by HFR.

The flagship investable index the HFRI 500’s tracking strategy is aiming initial fundraising of $500 million by May 2021 and it will have an investment capacity of over $50 billion.

The platform will also subsequently allow access to HFR’s investable index family, with circa 30 underlying investable hedge fund strategy, sub-strategy and thematic indices giving investors the opportunity to choose those most suited to their needs.

Russell Barlow
Russell Barlow
Alternative Investment Strategies – Global Head

“Our partnership with HFR means we are able to launch genuinely innovative benchmark tracking products. Before now products that attempted to track hedge fund benchmarks were both narrow in scope and the implementation approach resulted in investment outcomes that deviated from the return of the hedge fund industry.”

The new development of the innovative platform is following a partnership deal between ASI and HFR formed last year which will see the launch of a series of products for ASI’s index-tracking. The platform provides allocators to evaluate the performance of HFR’s investable hedge fund indices by physically investing in the underlying index constituents.

This approach has already spawned two innovative products, the HFRX Macro/CTA strategy which launched in the US last month with a commitment from a large institutional client. Meanwhile, in Europe, the partnership resulted in the launch of a strategy tracking the HFRI-I liquid alternatives index.