January 06, 2007
Understanding The Connect Between Private Equity and Hedge Funds
There is a recent trend that is worrying investors no end. Well, we can hardly call it recent, but the phenomenon of the convergence of private equity firms and hedge funds is getting quite a bit of attention nowadays. Affected investors now want a broader and better idea of this convergence and how it will shape things in the future.
A recent survey by Grant Thornton and the Association for Corporate Growth shows that the blurring line between private equity and hedge funds was driven primarily by hedge funds. These hedge funds seek higher returns and hence more capital to manage and the diversification of risk. At the same time, private equity firms are looking for ways to generate capital faster rather than waiting for portfolios to mature. Americanventuremagazine.com reports:
Additionally, the survey revealed that 83 percent of the private equity professionals pointed to hedge funds as the drivers of this trend. Hedge funds concur, with 52 percent saying that they are behind the convergence, and only three percent believe it is a private-equity driven phenomenon. Further, 39 percent of private equity respondents say the trend is having an effect on private equity investing, while only 23 percent of hedge funds say it is affecting their industry.
Read more: Blurring of the Line: Private Equity and Hedge Funds are Converging
--
Did you enjoy this post?
Comments
Post a comment
« Hedge Funds To Have A Good Year | Main | Barclays Fund of Funds Sims For $1bn »
Recent Comments