- Last Updated: 11:49 PM, August 19, 2012
- Posted: 10:26 PM, August 19, 2012
Move over George Clooney, here comes Bill Ackman.
Like Hollywood, the world of hedge funds has an A-list. Influential adviser Cliffwater LLC — which monitors some 1,500 hedge funds and ranks them with an A, B or C grade — keeps a closely guarded list of 90 or so top-rated funds.
Winning a spot on the list is akin to a golden ticket in the highly competitive hedge-fund world because it means access to “sticky” money investors, such as pension funds, according to sources familiar with Cliffwater.
Cliffwater advises large pension funds in New Jersey, Wisconsin and Massachusetts, among others, and has become one of the industry’s hottest gatekeepers as more big institutions invest directly in hedge funds rather than through funds of funds, which tack on another layer of fees.
An August copy of Cliffwater’s “500 top-rated A or B” funds obtained by The Post shows that the company gives high marks to activist funds such as Ackman’s Pershing Square and also to tail risk funds, which aim to protect against disasters.
Tucked inside the protected internal document, which compares five-year historical returns to risk, is Cliffwater’s “Select List,” which appears to be the 95 funds deemed worthy of A ratings.
Along with Ackman, Dan Loeb of Third Point, the hedgie who recently rattled Yahoo!, famed short-seller Jim Chanos of Kynikos Associates and gold hound James Melcher of Balestra Capital, made the short list as well.
Boaz Weinstein, the founder of Saba Capital, has two funds on it, including his newer tail risk fund, which was established to take advantage of so-called Black Swan situations.
Weinstein earned accolades for his winning trades opposite the “London Whale,” aka Bruno Iksil, the JP Morgan trader whose soured bets led to big losses for the bank.