Abstract
Most of the fund of funds in the Italian alternative investment market are managed to be low risk investment products. Investment managers undertake strong diversification policy holding a large number of assets in their fund portfolio; state low volatility targets, restrain from using leverage and are not fond of pure hedge fund manager with short track record. None makes use of equalisation techniques in calculating performance fee since their cost would easily exceeds their benefit. Compared to foreign funds, Italian funds of hedge funds are appealing in terms of the subscription and withdrawal conditions.