Exposure to Ucits hedge funds on the rise

hedge fund strategiesThe amount of investors in hedge fund strategies regulated by the Ucits regime has shown an increase and is expected to rise, albeit slightly, this year.

JP Morgan found that 27% of the 251 respondents to its ‘2018 Institutional Investor Survey’ invested in Ucits products last year – up from 21% in the previous year.

Just 1% of respondents did not have investments in Ucits investments, but planned to add them in 2018.

Of those that do invest in Ucits hedge funds, 55% had less than $50 million invested.

But they also planned to increase their exposure this year: 38% said they would increase Ucits hedge fund exposure, slightly less than the 41% last year.

The survey, a broad piece of research into the hedge fund industry, also found that 15% of respondents from the Americas had Ucits hedge funds in their portfolios. Over 60% of respondents in Europe, Middle East and Africa held Ucits hedge funds.

Increased liquidity is the primary driver for many investors to invest in Ucits funds, said JP Morgan’s capital advisory group, which published the survey on Friday.

For those who do not invest in Ucits funds, some of the reasons included lack of demand

from clients, lower expected returns and liquidity mismatch.

Other recent research showed a significant increase in Ucits hedge fund assets under management in 2017.

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