Putnam Investments mulls hedge fund debut

Putnam Investments, a $260 billion asset manager in Boston, Massachusetts, may soon join the ranks of other large money managers and launch new alternative investments funds, including hedge funds.

Matthew Halperin, a derivatives expert and senior vice-president at Putnam, began working on alternative assets strategies at the investment manager last month. Halperin has reviewed various new absolute return strategies, among them hedge funds.

Over a year ago, Putnam began seeding hedge funds with its own principals’ money to develop a track record. Returns have been promising, said one source at the firm. The managers of the funds have all been Putnam employees, the source added.

Putnam already has other direct experience with alternative investments as a backer of $1.1 billion private equity investment firm TH Lee Putnam Ventures, a joint venture with Boston-based Thomas H Lee Company. Private equity can be an attractive investment for wealthy individuals.

Halperin declined to comment on whether the Thomas H Lee Company, in addition to managing Putnam private equity funds, might also assist in the development of any future hedge fund business at Putnam.