Tremont, RiskMetrics to improve hedge fund risk reporting

Tremont Advisers, the global provider of hedge fund investment management services, has established a joint venture with RiskMetrics, which provides financial analytics, benchmark risk measurement and wealth management tools. The two companies are working together to develop web-based risk reporting for hedge fund managers and investors.

Tremont said the relationship is aimed at addressing specific issues relevant to the alternative investment industry, such as balancing the needs of investors to access risk exposure information with hedge fund managers’ ability to preserve their proprietary trading strategies.

The focus will be on creating best practice reporting standards for hedge funds and fund of funds, which will be made available to investors on a secure basis through RiskMetrics, a JP Morgan spin-off.

Cynthia Nicoll, director of business development at Tremont, said: "Current hedge fund risk reporting is inconsistent and non-transparent, making it difficult to assess risk in the aggregate at the fund of funds and firm level. Market participants have historically focused on position level transparency while the real issue is risk information and risk aggregation."

Peter Bernard, an executive director at RiskMetrics, added: "Combining our industry leadership in risk measurement with Tremont's knowledge of the hedge fund industry gives us an opportunity to provide increased value to hedge fund managers and investors alike.”