Beverly Hills, CA -- (SBWIRE) -- 03/25/2010 -- European hedge fund investors state British Virgin Islands hedge fund managers as a preference. As the hub of the industry, these managers can often boast attractive returns and investment experience, as well as offer funds which are at the forefront of the asset class.

BVI long/short equity funds are particularly popular with European investors because they have the potential to profit in a rising or falling market. This allows investors to build portfolios which are diversified not only by style, but by region too. European investors investing in BVI hedge funds will consider a range of investment strategies, and the BVI offers much greater choice in terms of styles to choose from.

After two years of dormancy, BVI hedge funds are growing once again. “We are seeing a significant amount of fund formation,” said Philippe Teilhard de Chardin, global head of prime brokerage at Newedge, a Paris-based firm.

Last month, Wall Street sat up and took notice when BVI-based Laureate Trust which only accepts €1 million minimum investment into its funds, launched a retail fund with a €2,500 minimum investment. CEO Peter Tasca says, “We’ve had huge demand for our retail fund. We’ve spoken to investors that have lost anywhere from €30,000 to €30,000,000 over the last two years and want a fund that can profit in any market environment.”

With financial markets on the upswing again, high-net worth clients and sovereign wealth funds are leaving traditional funds behind and moving into hedge funds. “For managers who had been sitting on the sidelines with new offerings in 2009, that means that now may be the right time to try launching,” said Udi Grofman, a partner in the investment management practice at law firm Schulte Roth & Zabel.

A well connected hedge fund manager may have been able to raise €1 billion in 2006 but in today’s market they’re probably looking at around €250 million. Tasca says, “investors have every reason to be skeptical of this market. A lot of clients that would normally make initial investments of €1 million are today subscribing to our retail fund with €50,000 to €100,000.”