LatAm Hedge Fund Outlook 2010

LatAmHedge2010NOV, 2009

Latin American Hedge Funds: Review and Outlook 

Alternative Latin Investor recently spoke with two high profile hedge fund players in Latin America, Otávio Vieira, Portfolio Manager at Safdié and Carlos Rojas Perla, Chief Investment Officer at Compass Group. We were privileged to hear how both managers felt markets had played out in 2009 and to learn of the themes they expect to dominate in 2010, as well as the strategies they were employing to best harness future returns.

The Hedge Fund Landscape 2008 & 2009

The impact of the global financial crisis was undoubtedly felt by Emerging Market and Latin American focused hedge funds in 2008. Since October 2008 a number of regional fund of funds have disappeared or were forced to merge in order to maintain critical mass and viability. Carlos Rojas Perla at Compass Group believes that assets under management of many funds are still 40% below the levels of two years ago. Indeed Rojas Perla explained that “we haven’t reached the bottom of the crisis in the emerging market fund of funds hedge fund market” and that new monies will predominately come from Family Offices rather than the traditional (fund of fund) investors.

However the majority of redemptions were seen in late 2008 and early 2009 as investors sought to reduce risk profiles in the face of the global economic downturn. In some cases these liquidations triggered redemption restrictions, but certainly with Compass Group this position has since stabilised with withdrawals in 2009 being matched by new investments generating a net/net asset flow position by the year end.

Performance during .....




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