Novare Investments SA Hedge Fund Survey October 2008

This report proudly marks the fifth edition of Novare Investments’ comprehensive annual survey of the South African hedge fund industry.

The survey takes a snapshot of the industry as at 30 June 2008 and summarises changes over the past 12 months in key areas such as strategies used, levels of leverage and market exposure, as well as operational issues, amongst others.

Who was included in the survey

This voluntary survey is conducted by means of a questionnaire that was sent to local hedge fund managers. The hedge funds included in the survey have the following “hedge fund characteristics” in common:

• The funds utilise some form of short asset exposure or short selling.

• The funds use some form of leverage, measured by gross exposure of underlying assets exceeding the amount of capital in the fund.

The survey excludes local absolute return funds (whose mandates do not allow for short exposure) as well as unit trusts that utilise derivatives in order to obtain leverage.

In addition, only rand denominated and South African domiciled hedge funds were included. Many of the local hedge funds have recently expanded their product offering to include offshore domiciled mirror funds of their fl agship offering. These funds have not been included in the survey.

Novare Investments believe that the survey covers at least 90% of the local hedge fund industry (both in terms of size and number of funds), and that this report thus represents an accurate snapshot of the industry as at 30 June 2008.

Click here to download the survey  (PDF file 370kb)