Highly commended: Best overall group

2009

Highly commended: Best Investor Relations Team

Established in 1989, GAM’s product range focuses on delivering quality alternative, high alpha equity, fixed income and absolute return strategies. Around 22% of GAM's fund of hedge funds (FoHF) assets are managed on behalf of private clients, 35% for institutional clients while 43% originates from other sources, including intermediaries and direct investors. It currently manages around $9.49 billion of client investments in FoHFs.

The group aims to be one of the most transparent funds of hedge funds (FoHF) managers. For example, detailed reporting including performance, risk and allocation data and manager outlooks complements its monthly fund factsheets. It provides regular strategy updates as well as fund information, news updates and manager videos via its website.

Its extensive experience in the hedge fund field has enabled it to build a comprehensive knowledge of the investment opportunities available to its FoHF managers. GAM reckons it currently monitors over 90% of the hedge fund universe.

Deciding which are the right funds involves a lot more than just cherry picking, says portfolio manager Arvin Soh who helps manage many of GAM’s FoHF products.

“While there are numerous criteria we use to assess managers, we spend a lot of time focusing on the managers’ edge and the sustainability of their approaches, strength in risk management and overall fit within our portfolios,” he says.

The events of recent years, including the demise of Lehman Brothers, the ensuing financial crisis and the many months of ongoing elevated volatility served to highlight the importance of a thorough, uncompromising manager selection and risk control process.

“Recent events have only reiterated to us the importance having a disciplined process to manager selection and risk management, as well as a particular focus on the smaller, newer and more specialized managers,” he notes.

GAM’s FoHFs include GAM Diversity, a multi-strategy fund that’s been running since 1989 and has around $ 3.521 billion under management, and GAM Trading II, a $2.485 billion fund running since 1997 as well as single strategy arbitrage funds such as the GAM Multi-Event Driven, a relatively new fund opened in 2007 which has attracted some $893 million from investors.

GAM Diversity has delivered consistent long-term annualised performance of 9.5% with volatility of 8.4%. GAM Trading II has never had a negative year since its launch and has returned an average of 9.2% a year with 5.9% volatility. They are two of a select few FoHFs to be AA and AAA-rated respectively by Standard & Poor’s.

GAM's annual global investment conference in London focuses on the economic issues likely to have a major influence on markets in the coming year with views from GAM managers, in-house and external. The conference aims to be an interactive forum with opportunities for attendees to ask questions and participate in discussions.

Education is vital, too. GAM holds educational seminars focused on teaching pension fund trustees the basics of hedge fund investing, absolute return investing as well as on how FoHFs fit into portfolios. The group also provides bespoke training on more sophisticated products such as portable alpha or structured product investing.