JP Morgan, Merrill Lynch, and CSFB, along with others, intend to develop a variety of products based upon the hedge funds that participate on the PlusFunds.com platform. Benjamin Cohen, a Managing Director with CSFB, noted, "The real time, independently verified hedge fund data provided by PlusFunds.com will help us design and manage better hedge fund products. This will add further value to our investors and will help set us apart from institutions that build products based upon "old world" hedge funds that don't use the sophisticated service provided by PlusFunds.com." It is anticipated that financial institutions will begin to provide equity style research reports on hedge funds participating on the PlusFunds.com platform and create and distribute fund of funds, structured products and index products based on hedge funds that participate on the platform. Noted Carty Chock, a Vice President with LabMorgan, "PlusFunds.com sets the stage for the hedge fund industry's reinvention and growth. Thanks to the platform's ability to provide Benign TransparencySM, whereby valuation and risk information is disclosed without revealing security-level information, we can know more about the funds without compromising the positions of the hedge fund managers themselves."
In addition to the three lead investors, several other investment firms participated in the financing, including Wachovia Capital, Gryphon Holdings, Koch Ventures, and SMS Securities. PlusFunds.com will use the $42 million investment to build out and launch the platform, carry out its marketing plan, and establish PlusFunds.com as the world's premier hedge fund service platform. Diego Winegardner, co-Chairman and co-founder of PlusFunds.com, added, "This round of financing provides PlusFunds.com with the economic resources necessary to maintain its technological lead and continue to add talent to an already impressive team of professionals."
About PlusFunds.com
PlusFunds.com is the world's leading independent hedge fund service platform with offices in New York and London. It was created in 1998 by a cooperative venture with Standard & Poor's, Ernst & Young, Advent Software, Inc. (Nasdaq:ADVS), RiskMetrics Group, and the Bermuda Stock Exchange (BSX) to serve three major functions: 1) Provide real time, tick by tick NAVs (Net Asset Values) of hedge fund shares 2) Provide a variety of daily risk measures, including VARs (Value at Risk), historical portfolio shocks and concentration analysis of hedge funds and 3) Allow for the creation of a secondary market for non-US investors that trades exclusively on the BSX.
The site intends to operate in ten languages (Arabic, Chinese, English, French, German, Italian, Japanese, Portuguese, Russian and Spanish) and access is free of charge, however, it is restricted to accredited US and sophisticated non-US investors. To date, the site has registered over 2,500 users from around the world. Numerous hedge funds have chosen to participate in the platform, which is expected to go "live" in the Fall. It is anticipated that the services offered by PlusFunds.com will create greater transparency and liquidity in the hedge fund industry, which the company believes will increase investor participation and thereby contribute to the growth of the hedge fund industry.