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Och observes that investors in hedge funds have changed over the years from the individual who wants returns to the institution that uses asset allocation for its decision making and wants excellence. Och-Ziff's investor base has always been institutional. This has solidified the firm's disciplined focus on its business mandate. According to the NACUBO 1999 annual survey, endowment clients include Amherst College, Carnegie Mellon University, Colgate University, Middlebury College, University of Michigan, and Yeshiva University. Fund of funds entities are not a large part of the investor base.

Following 1998, a bad year for hedge funds in general, Och observes that investors are not asking for any different information. "Because we delivered what was expected and have always been clear about what we do and don't do, investors are not so concerned about transparency."

Och provides his investors with a quarterly letter that lists the top positive contributors and negative contributors to performance as well as the basis points they added or took away. He also provides information on portfolio allocation and sizable positions. He is always available to meet with investors.

There are three funds. Each has a U.S. limited partnership and an offshore corporation. The OZ Master Fund is the multistrategy global fund. In addition, the firm offers two dedicated funds, OZ Europe, which focuses exclusively on European arbitrage, and O&F Credit Opportunities Fund, which focuses on distressed credits. All funds charge 1.5 percent management fees and 20 percent incentive fees. The minimum investments range from $5 million to $10 million. There is a two-year lock-up of capital.


Och originally had been a chemistry major at the University of Pennsylvania. But after his freshman year, he transferred to Wharton where his interest in finance was encouraged.

His first full-time job was at Goldman Sachs in the risk arbitrage department; he was there 11 years. Och left Goldman Sachs so he could build his own firm. As people go up the corporate ladder at Goldman, he says, they are moved from investing toward management. He wanted to focus on investing.

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