There is strong demand for most traditional hedge fund strategies in a UCITS format, according to a survey by ML Capital Asset Management, the investment manager and promoter of the MontLake UCITS platform.

The firm, which produces the MLC Alternative UCITS Barometer, a survey of active investors in UCITS funds about their forthcoming strategy allocations, says that most of the "UCITS-able" hedge fund strategies will see large inflows in the coming months.

Particularly, global discretionary macro strategies will lead the way in terms of inflows, ML Capital says, with 59 per cent of respondents planning to increase exposure to this strategy in the near future. Meanwhile, with expectations of more M&A activity this year the event driven sector is expected to be popular, with over half of surveyed investors saying they would raise holdings of both multi-strategy and merger arbitrage.

In the long/short equity space, 97 per cent of investors said they would either increase or maintain current exposure to US and global long/short equity funds. According to ML Capital, maintained demand combined with an under-supply of these funds should see a number of new launches in the near future.

Commenting on the findings, John Lowry, the firm's chairman and founder, said: “The alternative UCITS industry is still in its infancy and the large demand indicated in our initial survey for most of the primary hedge fund strategies is a reflection, I believe, of the fact that the vast majority of proven hedge fund strategies have yet to arrive in the UCITS game... The movement towards investing in alternative UCITS is demonstrating that this is not just a knee-jerk short-term reaction but a real trend that has created significant asset raising opportunities for those managers who have spotted the UCITS market potential in this early yet exciting stage."