It would not be an exaggeration to call Sandra Manzke the queen of Wall Street's hedge-fund industry. From her vantage point in the mid-1970s as a partner in a traditional financial firm catering to Fortune 100 companies, Ms Manzke watched as hedge funds grew in popularity as a financial instrument that could perform well in good markets and bad. At the time, hedge funds were the domain of the super wealthy, with entry requiring investible cash of between US$1 million and US$5 million. Investment legends such as George Soros were known to run money thorough hedge funds managed by big-name traders. By the late 1970s the hedge-fund industry was beginning to attract the attention of many of Wall Street's brightest stars. Gifted traders who ran the trading operations of some of New York's biggest investment banks were beginning to desert the traditional industry in search of the bigger financial returns and professional challenge. Many of these traders had made untold millions in the investment game already, Ms Manzke says, but they were attracted by the lure of running an operation that could play both sides of the market. For example, the traditional fund industry felt hamstrung by the one-dimensional equities-long strategy, which forced them to bet on a group of stocks that would, hopefully, go up in price. Hedge funds, on the other hand, appealed to the egos of star players, who could fire up 'absolute returns' strategies which allowed long or short equity bets, hedging, and the ability to shift cash around different asset classes. For many Wall Street stars it became more lucrative to trade their own accounts through self-managed hedge funds than wait for the comparatively meagre end-of-year bonus at an investment bank. 'So what a lot of very smart individuals who made a lot of money ended up doing was leaving ... to run hedge funds,' Ms Manzke says. 'So they could take their US$50 million to $100 million dollars of personal net worth, start a hedge fund, bring in outside investors and take 20 per cent of the profit participation. It was a lucrative business. 'I was hooked. These managers didn't have negative years when the markets went down and they were able to outperform the indices when the markets went up. 'People have a misconception about hedge funds because you always read about the bad guys. Guys that run away with money, lose a lot of money, and the ones that make a lot of money. In fact, most managers are pretty risk-adverse because they were running their own money.' In 1984 Ms Manzke launched Tremont Capital Management. 'I was probably the first consultant firm that looked at alternative asset management,' she says. She says the firm performs due diligence on hedge fund managers, evaluates their asset allocation decisions, performance and even their investment strategies. As hedge funds moved from the fringe towards the mainstream her client list grew. The firm now employs 87 people in four offices, and indirectly manages up to US$3 billion for groups such as the Teacher Retirement System of Texas, Banca Esperia, and MeesPierson. Ms Manzke says her part of her mission during her Asian road show is 'heducation'. She believes that Asia's investment culture is now similar to the US in the mid-1980s and that demand for these alternative strategy products will skyrocket in the next few years. 'There were no Asian hedge funds that I knew about five years ago, now there are at least 100 out there,' she says.