Investors learned a painful lesson on portable alpha during the financial crisis. Why they’re now taking a second look.

Hedge fund investors are increasingly paying attention to a strategy that hit its zenith of popularity and assets nearly two decades ago before being badly battered during the global financial crisis: portable alpha.

The Global Financial Crisis exposed significant weaknesses and the strategy took a beating. But is it getting a second chance? Jon Caplis shared some thoughts with Lydia Tomkiw on why this might be the case: “After the global financial crisis, it took nearly a decade for portable alpha to begin cropping up again. As part of the hedge fund industry’s institutionalization, managers are sitting down with clients and creating the products they want, including using separately managed accounts.”

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