For years, multi-strategy hedge funds have largely utilized the multi-manager model. However, that could change in the coming years as competition pressures fees and puts the pinch on smaller firms, potentially making the multi-manager model unsustainable, at least for some.
In a recent interview with Hedge Fund Alpha, Mike Gleason and Seth Weingram of Acadian Asset Management explained why a systematic multi-strategy fund makes for an interesting challenger to the prevailing multi-manager approach.
"We come up with our best ideas for a comingled vehicle …" explained Gleason, director of alternative equity strategies for the firm. "Everything is by design and purpose-built, so we're not just collecting strategies that happen to be here. We're being thoughtful on how to assemble specific targets in the multi-strategy model."
When a strategy worked… even though it shouldn’t have
In fact, Gleason’s team had one sub-strategy in development for a year or two, demonstrating how much thought they put into assembling their strategies. The firm launched several sub-strategies in early 2020. One, in particular, worked — even though it maybe shouldn't have.