Reuters – Investors able to provide seed capital for hedge funds are set to enjoy the most favorable conditions in years due to an abundance of talented start-ups and a lack of competing capital.
At a time when volatile markets, poor returns and scarcity of capital might be expected to discourage hedge fund start-ups, some managers are setting up on their own.
Some of these are traders coming out of troubled investment banks, or out of larger hedge funds that have run into difficulties, who see excellent opportunities thrown up by market volatility as a result of the credit crisis.
However, attracting assets is hard in an industry that is favoring larger hedge funds for their perceived security and where the bar below which some investors will not look at a fund can be between $100 million and $1 billion.
