Institutional Investor's Alpha Magazine - October 2008 - (Page 63)

for every hedge fund. In uncertain markets, J.P. Morgan’s ﬁnancial stability becomes even more important to our clients.” Caporale believes valueadd services such as risk analytics also become a key differentiator. J.P. Morgan’s acquisition of Bear Stearns brought the afﬁliate business Measurisk, expanding J.P. Morgan’s risk analytics capabilities. Measurisk is a risk analytics provider for hedge funds and fund of hedge funds that specializes positions, while hedge funds avoid having to disclose their positions to each of their investors.” “One of the most exciting aspects of Measurisk,” notes Caporale, “is Measurisk’s portfolio construction application. Our clients really get excited about this feature and with great reason.” Measurisk’s web-based interface enables clients to perform “what-if” analyses, hypothetically redistributing investments across funds and assessing the resulting risk distribution. J.P. Morgan’s overall product innovation reveals a ﬁrm-wide focus on managing risk. Accurate valuation is fundamental to hedge fund trading strategy and directly linked to ﬁnancial market turmoil. Recognizing this, J.P. Morgan has made deep investments into its capabilities for OTC derivatives and independent third party pricing. “We believe markets will continue to reward those service providers who can augment a fund’s valuation capabilities and provide managers with timely data on their portfolios and exposures,” Caporale states. It would be hard to exhaustively predict what the credit and ﬁnancial markets will do in the next few months. One prediction is the markets will likely continue to play out a ﬂight to quality in terms of investments, banking partners and even hedge fund administrators. J.P. Morgan believes its global reach and resources, in addition to commitment to operational excellence, will make it one of the few providers offering hedge funds and their investors this complete assurance of “quality.” J.P. Morgan’s overall product innovation reveals a ﬁrm-wide focus on managing risk. Accurate valuation is fundamental to hedge fund trading strategy and directly linked to ﬁnancial market turmoil. in acting as an intermediary between hedge funds and their investors. Historically, fund of hedge funds have not been able to obtain a full understanding of their exposure and risks due to the sensitive nature of hedge fund position data. Most often, hedge fund investors have had to rely on limited information provided by the fund managers, and in many cases, analysis of past returns. Measurisk obtains position level data on each of the underlying hedge funds, while investors receive only summary risk information, without access to any of the position details. Andrew Lapkin, President of Measurisk summarizes, “Investors receive the risk transparency they need, built up from underlying October 2008 • Alpha Sponsored Statement • 2

Table of Contents Feed for the Digital Edition of Institutional Investor's Alpha Magazine - October 2008

Institutional Investor's Alpha Magazine - October 2008 Contents Letter from the Editor Longs & Shorts Pension Corner: Process of Evolution The Good Guys: Israel's Champion Interview: Fast Lessons for Hard Times Cover Story: Industry Under Siege The New Hedge Fund Economics Good-Bye, Easy Money Caging the Shorts Strategies: Bottom Fishing Profile: Cult of Personalities Research Center: Alpha Awards: Eye of the Storm Alpha Bytes: Funneling the Chatter Unhedged: Commentary: Attention, Hedge Fund Shoppers

Institutional Investor's Alpha Magazine - October 2008

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