, or CPPIB, will spread funding among more firms as part of its emerging manager program by reducing the starting amount they invest with each fund, according to people familiar with the matter. Each will receive amounts starting from US$50 million, down from US$100 million, said the people, who asked not to be identified because the details are private.
Typically, CPPIB, which manages $570 billion in assets, will get a portion of the firm’s revenue in exchange for its backing. The program has previously agreed around three to five deals a year, and executives meet with more than 200 new managers a year, the people said. The move will also allow CPPIB to diversify its risk profile as part of its broader investment strategies, as tougher credit conditions wreak havoc on fund performance. More than 2,500 hedge funds have shuttered over the last five years, exceeding launches during the period, according to data compiled by Hedge Fund Research Inc.
The pension fund will continue to allocate larger investments of up to US$300 million as part of its broader allocation strategy, one of the people said.Article content