Hedge fund management: JPMorgan on an ‘aggressive’ drive in alternatives
JPMorgan has overtaken Goldman Sachs as the largest manager of hedge fund assets globally.
According to Absolute Return’s 2007 billion dollar hedge fund club survey, the firm now has $34 billion in hedge fund assets under management. Goldman Sachs Asset Management has $32.53 billion. Speaking at an investors’ day in March, Jes Staley, CEO of JPMorgan Chase’s asset and wealth management division, said that investments in alternatives had been growing at an annual rate of 28% since 2003, with flows of $14 billion in 2006. Highbridge funds attracted $6 billion of inflows in 2006, and a 97% growth in assets under management over the year – JPMorgan acquired a majority stake in hedge fund firm Highbridge Capital Management in 2004.
Staley said that the firm is targeting double digit-growth in its alternatives business in 2007. Building the alternatives business is "one of the biggest strategic plays we are making in asset management," said Staley. "We do believe the shift by many investors to absolute-return investments is not a fad, and we want to be the most aggressive firm in moving towards [that space]." In particular, the firm has been looking at real estate funds in Asia – last year it launched an India real estate fund. Staley added that the firm is launching a China real estate fund.