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September 16, 2019

Aberdeen Standard Investments, HFR to introduce hedge fund index trackers

Aberdeen Standard Investments (ASI) has teamed up with Hedge Fund Research (HFR) to introduce a range of investment products that will track various investable hedge fund indices.

Under the partnership, ASI will soon roll out a product that tracks HFRI 500’s index of 500 hedge funds.

The product will provide access to HFR’s investable index family with nearly 30 strategies along with sub-strategies.

To gain access to the new proposition, investors will have to invest at least $5m.

Plans are on to provide tracking funds for thematic indices in the future, ASI noted.

ASI global head of alternative investment strategies Russell Barlow said: “This partnership allows for a new benchmark for passive strategies in the hedge fund space.

“HFR has created a series of indices following an approach that would typically be seen in the equity and bond space – i.e. the ability of a product to physically own the underlying assets held in the benchmark – and applied it to hedge funds. This makes it a much more compelling benchmark for both hedge funds and allocators to reference when reviewing their investment strategies.

HFR founder and chairman Joseph Nicholas said: “Powerful institutional demand has both driven and shaped the marketplace for investible hedge fund indices, which provide not only robust, representative performance benchmarks but which also offer efficient access to leading fund manager performance.

“This exciting evolution allows institutions to achieve passive benchmark exposure while eliminating benchmark tracking error risk.”

The latest collaboration comes after the roll out of the ASI HFRI-I Liquid Alternatives strategy, which is said to have accumulated nearly $650m since inception this February.

In May, ASI introduced a suite of index tracker funds comprising five fixed income and three equity strategies.

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