LONDON Dec 3 Dyal Capital Partners, a private
equity fund set up to take stakes in existing hedge fund firms,
has closed to new money after raising $1.28 billion, showing
that demand to invest in the sector persists despite recent poor
Dyal closed the fund after attracting money from more than
40 global institutional clients and beating its $1 billion
target, asset manager Neuberger Berman, which will run the fund,
said in a statement on Monday.
The fund's strategy is to back around 12 to 15 established
hedge fund firms by taking minority equity stakes. Dyal has made
two investments so far, and expects to complete several more in
the coming months, the statement said.
Dyal did not name the two investments.
Buying stakes in already-established hedge fund managers is
a relatively niche area where few competitors operate.
Blackstone Group, however, is to launch a
multibillion-dollar fund to buy stakes in the secondary market,
Reuters reported in October, as traditional players such as
banks retreat due to disappointing hedge fund returns and more
Goldman Sachs' Petershill fund was also active in
The average hedge fund has lost money in two of the previous
four years, and while returns have improved in 2012, the average
fund's 4.5 percent gain this year compares badly with the 11
percent rise in the S&P 500 index, Hedge Fund Research
When funds do make money, the return on investment can be
huge for their owners because funds typically charge their
clients 20 percent of any positive performance.