With the investor landscape becoming more competitive, and with sophisticated investors expecting the liquidity of their fund investments to match the liquidity of the fund’s underlying investments, funds are looking for ways to innovate and offer investors more choice, flexibility and returns. To do this, an increasing number of investors are launching hybrid funds, which may offer a more diversified portfolio across asset classes and returns profiles, and flexibility for investors around liquidity options, compared to a closed-ended private equity fund or an open-ended hedge fund.
Hybrid funds are private investment vehicles that have attributes of both hedge and private equity funds. It may combine the illiquid investment strategies associated with closed-ended private equity funds with the liquidity and hedging strategies of open-ended hedge funds, offering investors the diversification that comes with exposure to both public and private investments.
Hybrid funds offer managers the flexibility to invest in a range of assets and to offer various liquidity structures to their investors. Though not a new phenomenon, hybrid funds gained in popularity after the 2008 financial crisis and are becoming increasingly popular.
To demystify hybrid funds, together with law firm Proskauer, we have worked on a complete Guide to Hybrid Funds. In this guide, we explain the background of hybrid funds, their advantages, the challenges of managing them and much more.
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The challenges of launching a hybrid fund are easily overcome with a strong partner by your side. IQ-EQ has the tools and expertise to administer funds across asset classes, whether liquid or illiquid. Our dedicated technology platform responds to the needs of both hedge and private equity markets for maximum flexibility. To find out more, feel free to contact me using the information below.