Over 500 of the leading players in the global fund of funds industry will gather for the sixth annual InvestHedge Awards for the best risk adjusted performance among the global funds of funds universe.

 

The fund of hedge funds industry gets bigger and stronger by the year. This year, assets in funds of hedge funds grew to more than $1 trillion and, according to the InvestHedge Database, there are now 2,657 fund of hedge funds products run by 571 management companies.

 

Every year seems to throw more tests at the fund of funds industry, but, every year, while some individuals may falter – few fail forever – the industry as a whole continues to attract assets. This perhaps explains why institutional investors continue to turn to funds of hedge funds as their first port of call for hedge fund investing.

 

This year the credit crunch in August was a particularly testing time. However, the overall fund of funds industry has returned 9.73% for the year to date, with emerging markets being the highest performing strategy for the year to date – returning 18.01%.

 

The year was one of consolidation with Key being the most recent acquisition, as well as continued exploration into new markets and strategies with the emerging market and natural resource themes featuring highly in the product development arena. Socially responsible and environmentally friendly funds of hedge funds have also started to populate the ever-growing universe. The sixth annual InvestHedge Fund of Hedge Funds Awards dinner will be held, like last year, at the Pierre Hotel in New York on Thursday 13 March to celebrate a healthy and growing industry. This year the InvestHedge Awards is going glamourous and the event dress code will be black tie.

 

The evening will start at 6pm with a canapé and cocktails networking reception, followed by dinner at 7.15pm. The presentation of the InvestHedge Fund of Hedge Funds Awards will start during dessert. Following the Awards presentation there will be an open bar and band, enabling guests to continue catching up with their peers.

 

The aim of the InvestHedge Awards is to recognise those funds of hedge funds that have produced the best risk-adjusted returns over a 12-month period, with awards being presented across a variety of strategy areas.

 

Last year saw 20 funds of hedge funds win awards in a competition that, in some categories, was very hotly contested. The event was hosted at the Pierre in New York and saw more than 500 people, including 70 funds of hedge funds and their clients and managers – with collectively more than $355 billion in assets – assembled in one room.

 

The industry is clearly maturing and evidence of this is that the categories this year remain unchanged from last year (see category box below), with the exception of the addition of a long-term performance award that will be given to the fund with the best risk-adjusted performance over a 10-year period.

 

The provisional nominations, based on November's data, will be online during January, with the nominations published in the February issue of InvestHedge. Unlike other award ceremonies, which are often decided on a more committee-like basis, the InvestHedge Fund of Hedge Funds Awards are designed as an empirical measure of the best performing funds, on a risk-adjusted basis, for 2007. This year there has been one very important change to the nomination criteria, and that is all firms hoping to be nominated must, as well as providing their monthly data, provide InvestHedge with a strategy allocation chart as of 31 December 2007 (see box for other nomination criteria).