While hedge funds that have sought non-traditional investors have gone the ’40 Act route through funds-of-funds structures, they should consider separately managed accounts, according to a report from Pershing and Greenwich Associates based on detailed interviews with 41 hedge fund and investment managers and 27 institutional investors.

Sixty-three percent of the investors said they like the opportunity to influence an SMA strategy and have a say on risk management according to the report, “Transparency and Liquidity: The Growth of Separately Managed Accounts in the Hedge Fund Industry.” Investors' primary reason for being more proactively involved is because of significant losses suffered in recent years.

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