Goldman Sachs continues the battle to revive funds of hedge funds. The asset management arm of the bank has in the works a mass-market fund with a minimum investment requirement of only $250 for individual retirement accounts. The minimum for regular accounts is $1,000.
Institutional shares do require at least $1 million, but that is not unusual for institutional shares.
The multi-manager product requires an exemption from the Securities and Exchange Commission to allow the hiring of managers without shareholder voting on each hire.
Goldman is not the only big fund of funds operator to pitch products to retail investors—competitors in this space, Grosvenor and Legg Mason’s hedge fund investment arm, Permal, have also applied to the SEC.
Blackstone Group has the largest fund of funds operation with more than $46 billion, followed by UBS, Permal and Grosvenor, according to trade publication HedgeFundAlert. Goldman is in fifth place with around $18 billion in assets.
Blackstone chief executive Stephen Schwarzman said, during a recent conference call, that funds of funds in general have about half the assets they had before the 2008 crash but Blackstone has grown substantially. It is clear that all the firms are looking for growth opportunities, including in the mass affluent market.
Tags: Blackstone Group, HedgeFundAlert, Legg Mason, Mutual Fund, Retirement accounts, UBS
HedgeFundSmarts 
May 7, 2013 at 2:32 pm
[…] Goldman fund requires an exemption from the US Securities and Exchange Commission to allow the hiring of managers without shareholder voting on each hire. Other fund of funds […]
September 25, 2013 at 12:28 pm
[…] Other firms also seek –and may have received – SEC exemptions for similar products. These include Legg Mason’s hedge fund investment arm – Permal – and Goldman Sachs. […]