Alceda Fund Management, Bank of America Merrill Lynch, KB Associates and fund management company Salus Alpha Capital debate some of the reasons hedge funds are interested in Ucits vehicles.

Michael Sanders, CEO of Alceda Fund Management, Eric Personne, head of fund solutions group at Bank of America Merrill Lynch, and Claire Cawley, executive director at KB Associates, together with Günther Schneider, hedge fund specialist with Salus Alpha Capital, discuss the attractions of Ucits structures for hedge funds as well as some of the negative aspects.

For Sanders there are two reasons why a hedge fund manager should be interested in Ucits vehicles. He cited institutional investor preference for more regulated, liquid and transparent structures as well as easier distribution of the fund, not only in the European Union but around the globe.

"There is a huge appetite for launching Ucits funds," agreed Cawley, "and it's driven by investor demand." After the 2008 crisis investors are looking for products offering a regulated solution and solutions that "look like a safe house". "I think you also find a lot of US managers are looking towards Ucits for the purpose of gaining access to a large number of markets," she concluded.

Personne thinks US managers are now aware of Ucits whereas a couple of years ago they were not interested. "If you believe what you deliver is real added value, and alternative investment claims it is added value and I do believe it is, there is no reason why this product shouldn't reach the largest possible audience," he declared.

Hedge fund specialist Schneider confirmed Salus Alpha Capital was one of the first hedge funds to move into Ucits. "The reasons: it's a standardised package, it's safe assets and finally you have a very defined liquidity - and that's always been missing in the offshore world."

A report of the panel discussion will be published in a special Ucits report in late September.