Ernst & Young, one of the world’s four largest consulting and auditing companies, found that a quarter of hedge funds expect to increase their exposure to cryptocurrencies next year. The 2021 Ernst & Young Global Alternative Fund Survey describes that alternative fund managers are slowly occupying a stable position in investors’ portfolios, and digital assets exist, albeit on a small scale.

EY survey finds hedge funds are eager for cryptocurrencies

2021 Global Alternative Fund Survey, a survey compiled by Ernst & Young, one of the Big Four company, Showing the performance and popularity of alternative fund managers among investors during the year.Investigation has Established Hedge funds are one of the most open platforms to incorporate crypto assets into their structure. According to the survey, a quarter of hedge funds are studying to increase their exposure to cryptocurrencies in the next year.

Due to the coronavirus pandemic, investors have had to experience a challenging and interesting year, and overcoming the difficult times provides a huge opportunity for alternative fund managers. However, cryptocurrencies are currently not popular among most of these fund managers, and only one in ten report exposure to these assets, which indicates that there is room for growth. In any case, the performance of these funds is impressive. 51% of investors surveyed said that the value of these alternative investments has increased, meeting or exceeding their expectations.

Digital assets as alternative investments

The rise of digital assets (cryptocurrencies) as an important asset class has led companies and fund managers to set their sights on being relatively profitable products in today’s complex markets. Although these real participation in cryptocurrencies are not as large as other unregulated assets, they are beginning to take a place in the field.

This growth is achieved when traditional investments are facing an unstable status quo. Investors seek to occupy new markets with new strategies. The survey bases these findings on conversations involving 210 managers and 54 investors, and provides a glimpse into the future of alternative investments and how cryptocurrencies may become an important part of it.

Regarding the importance of the decisions made at this crossroads, Natalie Deak Jaros, co-head of Ernst & Young’s global hedge funds, said:

This research highlights the resilience of our industry and the key transformations that managers and investors are working together to influence. 2021 is a year for the industry to invest to build important momentum around various initiatives that will bring dividends in the coming years.

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