FoF firm Adveq picks up AA2 rating

The Swiss private equity fund of funds [FoF] firm sets a trend with a fiduciary rating for business risk from fund manager rating agency RCP & Partners

In a move that many in the industry predict will become increasingly common amongst private equity fund managers, fund of fund specialist Adveq has received a AA2 rating for its investment activities. As more investors – both institutional and high net worth – look to private equity as part of their asset allocation mix, the demand for ratings against which to benchmark a firm looks set to increase rapidly.

The fiduciary rating from RCP & Partners, part of Rating Capital Partner SA, gives an indication of the structural and organizational risk that an institutional investor must take into consideration when investing.

The Zurich-based company claims that it is the first independent private equity fund of fund investment management firm worldwide to receive such a rating.

The rating upgrade – the third notch down from the top rating – ranks Adveq as “very good” in terms of meeting the high standards of service, governance, diligence and risk control set by professional investors such as retirement schemes, government funds and private banks.

In a statement Adveq said the rating reflected ' the institutional character that Adveq has reached since its foundation in 1997.' RCP noted in its rating of Adveq that: ' Private equity managers need to acknowledge that their primary purpose is to serve and protect the interests of their investor. In this respect, any focus such as Adveq 's on better risk control and transparency sets new standards, as well as showing an understanding of the concept of fiduciary risk.'

Adveq manages five fund of funds in two investment programs covering Europe and High-Tech/US with a combined SFR1.5bn of capital under management. The funds have entered into investment relationships with over 50 private equity investment teams in the United States, Europe and Asia.