Hedge Fund Intelligence New standards in Investor Transparency | Page 10

NEW STANDARDS IN INVESTOR TRANSPARENCY

investors,” says Pete Cherecwich, head of the global
fund services business unit at Northern Trust in
Chicago. “Investors started to ask whether they really knew what their exposures, concentrations and
correlations were, and to focus much more on the
liquidity of their investments.”
Institutional investors differed from hedge funds’
client base in two other important ways, both of
which also had implications for the thoroughness
of reporting standards. One of these is that they
tended to adopt a more critical approach to the fees
they were paying, and on the quality of the allPete Cherecwich, head
round service they were coughing up their 2+20
for. “As fees became more of a focus, investors deof the global fund
manded more for their money,” says Cherecwich.
services business unit
“Above all, they wanted more detail about where
at Northern Trust
their performance was coming from.”
>> As fees became more
In some instances, another new element that
institutions brought to the manager-client relaof a focus, investors
tionship, says Permal’s Fawcett, was a fiduciary
demanded more for their
requirement to know exactly what they are investmoney. Above all, they
ing in. “For example, insurance companies’ capital
wanted more detail about adequacy risk weightings on their hedge fund
where their W&f