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The impetus for the move, says Managing Director of Aspect Capital Anthony Todd, is to attain greater transparency of hedge fund pricing, by providing a venue where institutional investors have up-to-the-minute quotes rather than waiting for monthly statements to see how their investment is performing. Theoretically, such increased pricing transparency combined with an electronic environment for trading will result in an investment option that institutional-fund managers can embrace.
"What we see is that the tide is very much turning," says Todd, "institutional investors are clearly the largest potential market in the world for hedge funds so we think it's important that hedge funds can be responsive to their requirements."
Todd says that the decision to launch Aspect's new fund, a managed-futures fund called Aspect Diversified-Plus Fund Ltd., on PlusFunds.com has much to do with the fact that the hedge fund is back in vogue as an investment option.
He says that over the last few months, with the downturn in U.S. markets--especially the Nasdaq--people have started to look towards hedge funds, where they can turn a profit even in falling markets. That is because hedge fund managers are often authorized to use a number of higher-risk investment techniques, including using derivatives, short selling and borrowing funds, in order to generate a higher return, giving them the ability to generate revenue in almost any economic environment.
Aspect Diversified-Plus Fund Ltd. is the third fund launched by Aspect Capital that manages over $75 million in all. It also manages a European Equity Long/Short fund and an International Fixed-Income fund.
Aspect would very much like to have its other two funds on the PlusFunds.com Website and, Todd says, he hopes the funds will go up during the first quarter of next year. Hopes being the correct word because PlusFunds.com performs a rigorous due diligence on all funds and the companies that manage them prior to listing.
Todd says PlusFunds.com representatives visited Aspect Capital headquarters on more than one occasion and conducted background checks on company executives over a three-month process. Such extensive research is meant to engender confidence in any PlusFund.com offering--something very important to PlusFunds.com because it generates revenue by collecting a portion of new assets raised from investments made through the Website.
Todd adds, "I think we are going to see huge inflows of money into this sector but the institutions are only going to invest if they can actually get the level of liquidity and the level of transparency that they're used to and that's exactly what PlusFunds can offer."
