Emerging Hedge Funds Outperformed Larger Rivals In 2006

by Phillip Morton, Investors Offshore.com

02 February 2007

VanthedgePoint Group, Inc., an integrated financial services firm catering to emerging hedge funds, has announced that emerging hedge funds outperformed both established hedge funds and US stock market indices in 2006.

The strong 2006 returns posted by VanthedgePoint clients outpaced major hedge fund indices by over 300 basis points, the company said on Tuesday. According to published reports, in 2006 the Hedge Fund Research Index rose 12.99%, the HedgeFund.net Index advanced 11.76%, The Barclay Group's Hedge Fund Index was up 12.35%, Hennessee Group's Index gained 11.36% and Eurekahedge's Index advanced 13.4%.

"Our clients' performance in 2006 confirms academic research that suggests emerging hedge funds outperform their larger peers," observed Geoffrey M. Tudisco, chief executive officer and founder of VanthedgePoint Group, Inc. "By working with VanthedgePoint, our clients can mitigate their operational risk and focus on managing money to try and generate superior investment returns."

VanthedgePoint's emerging hedge fund clients also outperformed the major US stock market indices, something the major hedge fund indices have not accomplished since 2002 according to Marketwatch.com. In 2006, the Dow Jones Industrials Average rose 16.29%, the S&P 500 added 13.62%, and the Nasdaq was up 9.52%. Only the Russell 2000 Index, with its return of 18.4%, outperformed the emerging hedge fund managers using VanthedgePoint's platform.

"Hedge fund investor interest in our client base and integrated brokerage and operations platform continues to be astounding, demonstrating the high level of interest in identifying promising emerging managers," said Mr. Tudisco. He added: "Our ability to introduce investors to our clients allows us to add significant value, especially since 'raising money/marketing' was cited by 70% of respondents to our second annual Emerging Hedge Fund Manager Sentiment Survey as 'the most difficult aspect of running a hedge fund.'"

VanthedgePoint launched in the second quarter of 2006, with the goal of leveling the playing field between smaller emerging hedge funds and their larger multi-billion brethren. VanthedgePoint employs a business model to create economies of scale that result in improved operational efficiencies and lower costs for its clients. The result is a hedge fund that has lower operational risk and a reduced cost structure, which makes it more attractive to potential investors. Starting with US equity execution, VanthedgePoint has since added US options execution and international equities, options and futures execution to its integrated platform.

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