State Street launches dedicated hedge fund group

State Street Global Advisors (SSgA), the investment management arm of institutional fund manager State Street Corporation, has created a dedicated group for its hedge fund services, in a bid to cash in on increasing market demand for alternative investments.

SSgA already had approximately €700 million of hedge funds assets under management as of August 31 this year. It now intends to build on its existing expertise to develop new strategies aimed at institutional investors, fund of hedge funds, private banks and family offices. SSgA said it wants to launch a range funds that will exploit the company’s expertise in managing currency, fixed income, statistical arbitrage and mortgage-backed securities.

Headquartered in London, the SSgA hedge fund strategies group will be led by Chris Woods, who moved over from his role as UK chief investment officer in June to head the company’s hedge fund operations. Erich Stock and Scott Gregory will be responsible for marketing and sales in Europe and Middle Eastern markets, and US and Asian markets respectively. The group reports to Alan Brown, group chief investment officer of SSgA.

“As investors recognise the benefits of diversification in a challenging investment environment, the demand for hedge fund products will continue to increase,” said Brown. He estimates the market is currently valued at around $700 billion and is expected to grow threefold by the year 2010.