Hedge Funds of Funds: A Guide for Investors

8

An Example of a Hedge Fund of Funds' Investment Report

8.1 OVERVIEW

In this chapter we will see the theory of the above three chapters put into practice as we take a look at a typical investment report. This is a report containing information and critical analysis typical of a hedge fund that has been put forward for investment by a hedge fund of funds investment professional. This is an imaginary report based on an imaginary fund and people but it is a based on a culmination of many such investment reports, and so is based on reality. In the following report I will add comments in italics to explain what is said and why.

8.2 THE REPORT: Investment Report on the XYZ Hedge Fund

8.2.1 Summary and Critical Analysis

Fund:	The XYZ Hedge Fund
Manager:	Jones Asset Management
Manager Contact:	Martyn Johnson
Strategy:	Fixed Income Arbitrage and Relative Value
Geographical Focus:	United States
Fund Inception:	January 2004
Manager Founded:	1982

Fund Overview

This fund invests in relative value and other non-directional fixed income strategies. The fund's investment objective is to generate absolute return through investing in an actively managed style within the world of fixed income securities. The Fund is expected to be generally market neutral. So far, turnover has been appropriate for this strategy and returns have been consistent, backing up these objectives. They say that the ‘fund will be managed within a heavily risk controlled framework’ and this is backed up ...