Only 10 per cent of people think access to hedge funds should be restricted to professional investors, with most favouring wider public access.
Fifty-five per cent favour direct access while 35 per cent think access should be given but only through specialist investment managers, according to a survey of 3,091 people by F&C Investments.
Francois Barthelemy, a partner at F&C’s fund of hedge fund business, F&C Partners, says: “Investors are becoming more sophisticated in their investment choices and recognise the benefits of hedge funds as a risk-reducing tool in their portfolios. Provided that hedge funds are managed by teams of professionals, there is no reason why they should be considered any more risky than the average equity or fixed-income investment.”
Seventy-seven per cent of respondents think the FSA should extend the marketing of hedge funds to retail investors but 63 per cent believed strict guidelines were needed.
Fifty-two per cent say they would prefer absolute returns irregardless of market conditions while only 14 per cent preferred traditional fund goals against an index.
Barthelemy says: “Funds of hedge funds, managed by a team of investment specialists with the necessary expertise to do a detailed screening, due diligence and face-to-face research process, provide a great solution for retail investors wishing to gain exposure to hedge funds.
“The closed-ended structure is also well suited to underlying asset classes such as hedge funds and their oversight by independent boards gives shareholders additional comfort that their interests are being looked after.