Just what do we mean by Funds? Well many things, such as Venture Capital Funds, Hedge Funds, Real Estate Funds, Fund of Funds, Leveraged Buyout Funds etc. etc. etc.
Funds could also be called non traditional investments or private investments. In any case, they represent a fast growing segment of all Institutional Tax Exempt Investors such as Pension Plans, Foundations and Endowment Funds. Why is that?
This page was last updated: October 31, 2009
Comments from Len Chaikind - 7/15/2006
From what I can gather from reading the various literature on Private Investments (also called non-traditional investments), many consultants would consider that the average return would be about 12%. While this is quite a bit better than the average traditional investment, i.e. a combination of equity and fixed income managers, it still is low relative to what we can see as a very doable return.
In my view, based on maybe 30 years of experience in this area, this number should be more like 20 to 30 percent per annum on an IIR basis. Further, if the investor would be properly selective and diversified, bringing this part of the portfolio up to a range of 20 to 40%, this should also have a long term impact of reducing the risk (volitility) of the entire portfolio.
IICC's long term goal is to work with some very high quality Funds (see above for a definition) to raise over $5 billion dollars within 5 years. Actually we have already raised considerable monies for Funds in the past, but for various reasons have not been actively involved in this area for about 2 years. We now think the time has come to reactivate this goal.
For this reason we now have signed agreements with 4 Funds and are actively negotiating with 4 more; the current ones are:
1 - a top decile hedge fund
2 - a structured fund of funds working with a major bank
3 - a trading fund; e.g. commodities
4 - a first and second stage venture capital fund operated by the same group
Further, I have now assumed responsibility as the overall funds Team Leader for what we are calling IICC - Funds. Longer term, we would expect to be associated with as many as 10 different funds and fund of funds.
In the future, we will have considerable more material on funds, but in the meantime, if anyone wishes to know more, they should give me (Len Chaikind) a call at one of these numbers - 713-266-4422 or 713-824-6051.
Len Chaikind (lsc) - 7/15/2006
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