Sources say D.E. Shaw provides access to its biggest investor, Blackstone, to select funds not made widely available to the greater investor base.
"You've seen the maturation of the business push hedge funds and alternative investment managers to segment their investors," said Jonathan Doolan, principal at Deloitte's Casey Quirk, speaking about hedge funds in general.
"The largest clients might be serviced by the head of the firm, and the smallest will meet with IR," he said. While many investors have to travel to the hedge fund to meet, for the biggest investors, portfolio managers will go to them, he said. A source familiar with the firm's thinking said that when the firm launched the fund, all investors were notified in a conference call and by writing, and that various external investors have been in the fund. The source said the fund is currently at capacity and closed to new investors.
In funds with other investors, Blackstone pays the same fees as everyone else, sources say. However, D.E. Shaw created one fund specifically for the private equity giant in 2010, known as Composite Graphic, which is a version of the firm's popular Composite strategy without the most illiquid investments in the fund's portfolio.
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