Category: News Excerpts

By Mariah Summers | 10/17/18

…But the 10-largest macro funds have fared a bit better, returning .90% so far this year, though they saw performance of -1.46% in the third quarter, compared to -.90% among all macro funds.

This trend is likely to spell trouble for macro funds of all sizes if it continues, says Christopher Cutler, president of Manager Analysis Services.

“There is a high risk of disappointment if returns do not improve,” Cutler says. “I was speaking with one very large institutional allocator recently that still is a very prominent hedge fund investor. His organization is likely to make large redemptions and greatly reduce the share of hedge funds in their portfolio over the next year.”

That puts pressure on macro funds, he says.

“I would like for macro hedge funds to demonstrate sufficiently improved results to sustain the recent rally in allocations, but hedge funds seem to be slipping behind private equity and ‘real assets’ investing as perceived ways to diversify institutional portfolios,” Cutler says.

But for now, macro managers may have a short window still to work out performance issues in the near term as investor fears of a sell-off intensify.

By Alyson Velati | 7/3/18

…Typically, investment consultants already include “pricing guidance” in their fees, says Chris Cutler, president of Manager Analysis Services, a firm that provides manager diligence and governance review services for institutional investors, via email.

By Lydia Tomkiw | 6/13/18

…While there’s relief that hedge fund performance has improved, institutions are also continuing to spend more time thinking about where hedge funds fit into their universe, says Chris Cutler, president of Manager Analysis Services.

By Lydia Tomkiw | 2/14/18

…Several strategies in particular could stand to benefit after a couple of years of lackluster hedge fund industry performance, if market jitters continue. “This is an environment where global macro should start to do well,” says Chris Cutler, president of Manager Analysis Services.

Macro hedge funds entered 2018 on stronger footing than in past years, posting gains of 3.34% in January, the best aggregate month since before the 2008 financial crisis, according to eVestment.

By Lydia Tomkiw | 10/11/17

…Some smaller quant funds also can offer fee breaks that industry behemoths won’t, which can help sweeten the deal, says Chris Cutler, president of Manager Analysis Services.

“There are some smaller quant funds that are very good,” he says. “Institutional investors just need to look harder and find them.”

…But one advantage quant funds have is that investors are more willing to tolerate some down months as institutional investors continue to look for hedge fund investments to provide diversification, Cutler says.

By Lydia Tomkiw | 8/23/17

…The composition of hedge fund investors has been shifting amid these trends as larger investors continue to push ahead while smaller investors are becoming less engaged in the space, says Chris Cutler, president of Manager Analysis Services.

“I’m seeing much longer term allocations to hedge funds as a strategy and then movement across those hedge strategies,” he says.

By Lydia Tomkiw | 7/5/17

As the hedge fund industry continues to struggle with performance, tensions in organizations can sometimes be better resolved with amicable departures and endorsing the ambitions of people who want to start their own businesses, says Chris Cutler, president of Manager Analysis Services. Investors need to have resources for monitoring such cases to make sure they are adequately informed, he says.

“Instability within the management structure is a natural ‘flag’ for due diligence analysts to take a closer look at the stability of the hedge fund organization. But cautionary ‘flags’ are constantly flying in the hedge fund industry, and without a close look by dedicated analysts, it can be difficult to discern whether the flag is a false alarm or a real concern,” he says in an email to FundFire. “That’s why investors should resource their due diligence and monitoring functions generously.”

By Alyson Velati May 3, 2017

“Family offices – which made up a quarter of fund searches in the Preqin data – are continuing to be more adventurous than large institutional investors when it comes to hedge fund allocations, says Chris Cutler, president of Manager Analysis Services. A brighter start to 2017 has laid the path for hedge funds to argue their merits, he says.

“I think recovering hedge fund performance opens an avenue for the better hedge funds to make their case,” he says in an email to FundFire. “They should be very thoughtful about their positioning, because the decision-makers at institutions are also changing at an accelerated pace.”

By Alyson Velati April 21, 2017

“The Investment Management Institute (IMI) recently joined forces with investment consultant Manager Analysis Services to launch an outsourced CIO (OCIO) search platform. Manager Analysis Services has $5 billion in assets under advisement, according to its website.

“It’s a chance for [OCIOs] to tell their story,” says Chris Cutler, president of Manager Analysis Services, who is working with IMI on the platform. “The more challenging questions won’t be in the RFI, but rather when we meet with firms in person.”

IMI and Manager Analysis Services will avoid creating a short list of OCIO firms, like many traditional consulting firms do with their vetted manager lists, says Cutler.

“Our approach will be different,” he says. “We’re not looking to rank the firms. It will be a multi-dimensional consideration to see what their strengths are. It’s one thing to review managers. The second is to recommend them and the third is to be accountable for them.”

By Lydia Tomkiw March 22, 2017

“With upcoming elections in France, Germany and other European countries, the continuing Brexit process and political uncertainty in East Asia, managers with edges and expertise in those areas will be key to watch,” says Chris Cutler, president of Manager Analysis Services. But with a lower risk appetite among investors, the biggest challenge remains picking the right manager.

“There’s a lot of macro fatigue still out there,” he says. “You would think macro would have done better with a very interesting U.S. election and Brexit…It’s a bit of a challenge from an allocation perspective.”

…..

With a long laundry list of uncertainties spanning geopolitics, trade policy, and monetary policy, managers are faced with many “maybe’s,” Cutler says. “‘Will they figure it out?’ is my question,” he says. “They can get it wrong. You really need to be good at picking the right manager in these situations.”