THE National Pension Reserve Fund has appointed an American consultancy firm to advise it on investing in hedge funds.

The €22bn fund hired New York-based Aksia to provide advice on strategies for investing in so-called funds of hedge funds. The NPRF plans to invest up to €500m in these funds. Aksia has been asked to find "the difficulties that arose for funds of hedge funds in 2008 and on why they continued to underperform the general hedge fund industry in 2009".

The company says it provides "analytics and processes to assist institutional allocations to hedge funds and funds of funds". The company is headed by Jim Vos, a former Credit Suisse banker and one of the best-known names in the hedge fund industry.

A fund of funds invests in a portfolio of hedge fund managers to maximise gains. Hedge funds suffered their worst year on record in 2008, though they did rebound 19% last year, according to EurekaHedge, which tracks their performance.