The outlook for hedge fund-of-funds in Australia has brightened a little, with an industry fund that redeemed all of its investments in 2008 continuing to rebuild its exposure, with Aurum Funds Management’s Isis Fund the latest beneficiary.
The $2 billion TWU Super has invested an undisclosed amount into the new Australian dollar version of the Aurum Isis Fund, which has a minimum wholesale subscription of $10 million.
The Isis Fund differentiates itself in the hedge fund-of-funds universe by having no directional equity strategies or commodity managers. It’s understood this feature was attractive to TWU Super because it is trying to reduce equity risk in its portfolio.
The allocation to Aurum continues the rebuilding of faith in hedge fund-of-funds which TWU Super has exhibited since late last year.
After redeeming a $70 million mandate from the hedge fund-of-funds offered by Warakirri Asset Management in late 2008, in November 2009 TWU Super awarded $60 million to U.K. hedge fund-of-funds manager Fauchier Partners, and invested A$40 million in GMO’s multistrategy trust.
Those mandates had lifted TWU Super’s overall hedge fund exposure to 5 per cent of its total portfolio.
TWU Super chief investment officer, Andrew Killen, said at the time that further hedge fund-of-fund comitments may follow, “depending on how markets, and hedge fund and growth assets go.”