Case Study

Pacific Alternative Asset Management Company (PAAMCO)

21 pages
December 2003
Reference: IMD-1-0197

In a bleak period for the financial industry, hedge funds stood out as one of the few growth businesses. Hoping to obtain absolute returns that are uncorrelated with broader stock market movements, while further diversifying their portfolios, institutional investors embraced this alternative asset class. However, as the number of hedge funds has burgeoned so did the challenge of investing in them. Typically cautious, institutional investors have been loath to leap into an area outside their core competences and started turning to a group of intermediaries known as fund-of-hedge-funds managers, such as PAAMCO, that specialize in identifying the best hedge fund managers for their clients. The case explores the issues faced by fund-of-hedge-funds managers when selecting the hedge funds to build either standardized funds or custom portfolios for their clients. In a broader sense the case provides for discussions on what hedge funds are, what investment strategies they use and who their investors are as well as exploring the general aspect of asset pricing portfolio theory.

Keywords
Risk Management
Settings
United States of America
2000
Type
Field Research
Copyright
Ā© 2003
Available Languages
English
Case clearing houses
IMD case studies are distributed through case clearing houses. In order to browse the collection and purchase copies please visit the links below.

The Case Centre

Cranfield University

Wharley End Beds MK43 0JR, UK
Tel +44 (0)1234 750903
EmailĀ [email protected]

Harvard Business School Publishing

60 Harvard Way, Boston MA 02163, USA
Tel (800) 545-7685 Tel (617)-783-7600
Fax (617) 783-7666
EmailĀ [email protected]

Asia Pacific Case Center

NUCB Business School

1-3-1 Nishiki Naka
Nagoya Aichi, Japan 460-0003
Tel +81 52 20 38 111
EmailĀ [email protected]

Contact

Research Information & Knowledge HubĀ for additional information on IMD publications

Looking for something specific?
IMD's faculty and research teams publish articles, case studies, books and reports on a wide range of topics