Key Takeaways
- • Fundana, a Geneva-based fund of funds manager founded in 1993, has delivered a 27-year track record of outperformance against both the MSCI and HFRX Global Hedge Fund Index, achieving 12% net returns in 2019 alone while experiencing net inflows despite broader industry headwinds.
- • The firm's defensive positioning during the 2008 financial crisis—maintaining no gates, no redemption suspensions, and zero Madoff exposure—established institutional credibility that continues to differentiate it in manager selection and operational risk management.
- • Fundana outperformed major equity benchmarks in 2018, a difficult year for hedge funds, and in 2019 exceeded returns of all major single hedge fund indices, demonstrating consistent alpha generation across market cycles.
- • The firm's investment philosophy centers on "Discover Talent Early, Control Downside, Ensure Upside," emphasizing early-stage manager identification and downside protection as core competitive advantages in alternative asset allocation.
Summary
Fundana stands as a notable outlier in the hedge fund of funds industry, capturing net inflows during a period when capital allocation to alternative investments remains highly selective. Founded in 1993 as one of Switzerland's first independent institutions dedicated to alternative investments, the firm has maintained institutional-grade performance across nearly three decades—a tenure that places it among the industry's longest-standing operators with documented track records.
The firm's 2019 performance illustrates its consistent execution. With a net return of 12%, Fundana's fund of funds vehicles outperformed all major single hedge fund indices as well as traditional benchmarks including the MSCI. This represents particularly strong relative performance given that 2019 was a broadly positive year for most hedge fund strategies. The ability to generate returns that exceed both the HFRX Global Hedge Fund Index and equity indices simultaneously points to disciplined manager selection rather than broad index capture.
Fundana's reputation for manager selection excellence and operational rigor crystallized during the 2008 financial crisis—a critical differentiator. While the broader hedge fund industry faced widespread gates, redemption suspensions, and catastrophic Madoff-related losses, funds of funds advised by Fundana maintained full liquidity and had zero exposure to the fraud. This defensive positioning during systemic stress events has become a cornerstone of the firm's institutional value proposition, demonstrating risk management discipline that extends beyond performance metrics.
The firm's documented outperformance extends across market cycles. In 2018—a challenging year for both hedge funds and equity markets—Fundana's funds outperformed the MSCI and S&P 500, indicating genuine downside control rather than merely riding favorable market conditions. This cycle-agnostic performance aligns with the firm's stated investment philosophy of "Discover Talent Early, Control Downside, Ensure Upside," which emphasizes early identification of emerging manager talent while maintaining strict capital preservation discipline.
The ability to attract net inflows in an industry experiencing significant consolidation and performance scrutiny reflects institutional confidence in Fundana's manager selection framework. For sophisticated investors evaluating fund of funds vehicles, the combination of 27-year documented performance, crisis-period resilience, and continued inflows suggests that Fundana's approach to identifying skill versus luck in manager selection continues to resonate with institutional allocators.
The firm's 2019 performance illustrates its consistent execution. With a net return of 12%, Fundana's fund of funds vehicles outperformed all major single hedge fund indices as well as traditional benchmarks including the MSCI. This represents particularly strong relative performance given that 2019 was a broadly positive year for most hedge fund strategies. The ability to generate returns that exceed both the HFRX Global Hedge Fund Index and equity indices simultaneously points to disciplined manager selection rather than broad index capture.
Fundana's reputation for manager selection excellence and operational rigor crystallized during the 2008 financial crisis—a critical differentiator. While the broader hedge fund industry faced widespread gates, redemption suspensions, and catastrophic Madoff-related losses, funds of funds advised by Fundana maintained full liquidity and had zero exposure to the fraud. This defensive positioning during systemic stress events has become a cornerstone of the firm's institutional value proposition, demonstrating risk management discipline that extends beyond performance metrics.
The firm's documented outperformance extends across market cycles. In 2018—a challenging year for both hedge funds and equity markets—Fundana's funds outperformed the MSCI and S&P 500, indicating genuine downside control rather than merely riding favorable market conditions. This cycle-agnostic performance aligns with the firm's stated investment philosophy of "Discover Talent Early, Control Downside, Ensure Upside," which emphasizes early identification of emerging manager talent while maintaining strict capital preservation discipline.
The ability to attract net inflows in an industry experiencing significant consolidation and performance scrutiny reflects institutional confidence in Fundana's manager selection framework. For sophisticated investors evaluating fund of funds vehicles, the combination of 27-year documented performance, crisis-period resilience, and continued inflows suggests that Fundana's approach to identifying skill versus luck in manager selection continues to resonate with institutional allocators.
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