70% Of Investor Relations Folks Down On HFs

Seven out of 10 investment relation officers have a negative view of hedge funds, as they believe hedgies will increase volatility, according to a Thomson Financial survey.

Seven out of 10 investment relation officers have a negative view of hedge funds, as they believe hedgies will increase volatility, according to a Thomson Financial survey. In addition, the study found that 25.7% of IROs are concerned about hedge fund activism (though only 15% of hedge funds view themselves as activists). Two-thirds of IRO respondents expressed concern about short selling and 56% about the lack of transparency among hedge funds. In other findings, the research revealed that hedge funds want little to do with the IROs – their official conduits to highers-up in a company – with only 23% of hedge fund investors preferring to meet them, while 30% would rather be introduced to middle managers and heads of business units. A concern that popped among IROs, according to Thomson, is the swaggering HF attitude, citing one respondent who said that hedge funds “can piss off management with [their] at times aggressive and undiplomatic posture.” Well, the investment relations folks better get used to it: 75% of hedge funds now invest in equities, and as their presence becomes greater, they’ll be harder to ignore.