ABSOLUTE RETURN-ALPHA MAGAZINE Brazilian hedge funds: Pushing Brazil forward

After surging in 2009, the country’s managers stalled after developing the world’s sixth-largest hedge fund industry. In an effort to restart, they are trying to move beyond their traditional offerings

When U.S. citizen Michelle Noyes joined BRZ Asset Management in Brazil’s financial capital, São Paulo, in February last year, she didn’t speak any Portuguese and had only the most tenuous connections to her new home. Today, as she markets Brazilian hedge funds to foreigners, she finds lots of interest in Brazil but a reluctance to put down money: “It’s easy to set up meetings. The tricky part is getting financial commitment,” she says.

That’s a problem. While the Brazilian investor market for hedge funds is growing, an addiction of retail investors to fixed-income benchmarks and these investors’ tendency to pull their money after even a month or two of poor performance are two defining features. Selling to sophisticated managers overseas would give Brazil’s hedge funds the much-needed scale and fortitude lacking in the home market.

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