BOSTON, July 16 Blackstone Group LP, one of the world's biggest hedge fund investors, is now giving retail clients a taste of these normally exclusive portfolios through a new mutual fund.
The Blackstone Alternative Multi-Manager Fund (BXMXX) will be run by the company's hedge fund unit and be advised by nearly one dozen hedge funds, including Two Sigma Advisers, HealthCor Management and Good Hill Partners, the company said in a statement on Tuesday.
Best known as a private equity business, Blackstone's hedge fund unit, Blackstone Alternative Asset Management, boasts strong industry credentials, having investing $49 billion with prominent firms including Pershing Square and D.E. Shaw & Co, and seeding newcomers like Marcato Capital Management and Bow Street LLC.
Blackstone is rolling out the new fund seven months after filing registration documents with the Securities and Exchange Commission and said it has been considering plans for far longer.
"Blackstone has spent the last three years analyzing and preparing to enter the market for liquid alternatives," said John McCormick, senior managing director and head of global business strategy for the firm's Blackstone Alternative Asset Management unit.
Blackstone joins a growing number of firms tapping into the hedged mutual fund business at a time investors are demanding more choices, especially in the wake of the recent bond market sell-off, which rattled some prominent mutual funds. Investors are also balking at hedge funds' high fees and long lock-up periods where clients may not get access to their cash for a year or more.
In December Fidelity Investments, one of the industry's biggest mutual fund firms, teamed up with Arden Asset Management to offer a similar fund.