Colonial signs consultants for hedge funds

In preparation for the roll out of retail and wholesale fund of funds hedge funds later this year, Colonial First State has appointed Harcourt Investment Consulting as its hedge funds consultants.

Harcourt is based in Zurich and will work exclusively with Colonial to provide advice on hedge fund portfolio construction, manager due diligence and risk monitoring.

Damien Hatfield, head of Colonial’s new Absolute Return Funds group and Dr Joe Fernandes, director of investments for hedge fund products will work closely with Harcourt’s own investment team led by Dr Philipp Cottier and senior analyst Christophe Gruenig.

Colonial will also second one of its staff, Absolute Return Funds senior investment analyst David Bell, to Harcourt for six months with Bell working out of their office in Zurich.

Hatfield says the addition of Harcourt to the Colonial hedge fund rollout gave it an advantage since Colonial would be able to supply a sizeable hedge fund portfolio management operation, based in Australia, while making use of offshore research and managers across the globe.

Colonial indicated in March of this year that it would enter into the hedge fund market and despite Harcourts involvement in the products Colonial will be the responsible entity of the new hedge fund products.

At the time Colonial chief executive Chris Cuffe said the launch of a multi manager hedge fund was largely in response to research that shows investors were increasing their allocation to alternative investments.Colonial general manager of investments John Pearce said also at the time that the underlying managers in the fund will be international, as most hedge funds are presently more numerous overseas, especially the United States.

However, Pearce emphasised that Colonial is a supporter of the local markets and expects that Australian managers will be more frequently used as hedge funds take root on local soil.