SEI White Paper: Investor Demand Drives Growth of Alternative Mutual Funds in U.S. and Europe

Investor Education and Strong Infrastructure Keys to Manager Success as Traditional and Alternative Investments Converge

DUBAI, United Arab Emirates, May 24, 2010 - In the wake of historic market losses and epic scandals, a restless and
empowered investor base is demanding greater transparency and liquidity from
managers, while focusing on absolute returns and uncorrelated investment
strategies. This combination of factors is driving convergence of traditional
and alternative investment products, with investors pouring more than US$110
billion into alternative mutual funds in the U.S. and Europe in 2009 alone,
according to a white paper released today by SEI (Nasdaq: SEIC) in
collaboration with Strategic Insight. The paper, entitled Exotic to
Mainstream: Growth of Alternative Mutual Funds in the United States and
Europe, evaluates the opportunities and challenges managers face when
launching and distributing alternative investment strategies in a registered
mutual fund or UCITS format, as the trend toward "mainstream alternatives"
gains significant momentum.

As evidenced by inflows to these alternative mutual funds, investor
demand creates new opportunities for managers. For alternative firms facing a
predominantly institutional investor base, offering their strategies in a
mutual fund structure opens up a substantially broader and more diversified
market opportunity. Meanwhile, traditional managers also see an opportunity
for increased fund flows as well as potentially higher margin products and
revenue diversification. According to the paper, however, managers must
initially determine whether offering an alternative mutual fund can be
accommodated within their investment parameters and whether it fits their
branding and long-term business strategy. Managers must also address key
regulatory, operational and distribution considerations before diving into
these new investment products.

"The balance of power may have shifted in this 'Era of the Investor(SM)',
but if managers position themselves properly, convergence may offer an
opportunity for them," said Phil Masterson, Managing Director for SEI's
Investment Manager Services division. "Alternative mutual funds create new
market opportunities, new revenue opportunities, and new product offerings
that can meet the evolving needs of investors in today's environment."

A diverse group of strategies and managers are already experiencing
success with these products in the U.S. and Europe. Successful strategies
include long/short, global tactical asset allocation, volatility arbitrage,
and managed futures. Sponsors are geographically dispersed across the United
Kingdom, France, Sweden, Switzerland, and the U.S.

According to the paper, while it's difficult to precisely measure the
market opportunity for these vehicles, the potential appears to be
significant, as evidenced by intermediaries modifying their model portfolios
and recommended lists to accommodate alternatives - typically at the expense
of the equity portion of the portfolios. In 2009, investors poured more than
US$110 billion into alternative mutual funds, with the largest flows going
into long/short, market-neutral, commodity, and currency funds. A more
detailed breakdown is as follows:

    - Approximately two-thirds of these net new flows (US$75
      billion) went into alternative-style U.S. mutual funds and ETFs, and
      one-third (US$35 billion) into European mutual funds (UCITS) and ETFs.

    - Nearly 5 percent of U.S. retail alternative mutual funds and
      ETFs had net inflows of US$1 billion or more in 2009; in contrast,
      approximately 3 percent of all traditional long-term U.S. mutual funds
      and ETFs had inflows exceeding US$1 billion.

The white paper provides additional insights on growth opportunities,
market factors and challenges facing managers in the current environment. The
paper is published by the SEI Knowledge Partnership, in conjunction with
Strategic Insight. The SEI Knowledge Partnership provides ongoing business
intelligence to SEI's investment manager clients. To request a copy of the
24-page white paper, please visit www.seic.com/AltMutualFundGrowth.

About SEI's Investment Manager Services Division

SEI's Investment Manager Services division provides comprehensive
operational outsourcing solutions to global investment managers focused on
mutual funds, hedge and private equity funds, exchange traded funds,
collective trusts, and separately managed, as well as institutional and
private client, accounts. The division applies operating services,
technologies, and business and regulatory knowledge to each client's business
objectives. Its resources enable clients to meet the demands of the
marketplace and sharpen business strategies by focusing on their core
competencies. The division has been recognised by Buy-Side Technology as
"Best Fund Administrator" and by HFMWeek as "Best Funds of Hedge Funds
Administrator." For more information, visit
www.seic.com/enME/investment-managers.htm.

About SEI

SEI (Nasdaq: SEIC) is a leading global provider of outsourced asset
management, investment processing and investment operations solutions. The
company's innovative solutions help corporations, financial institutions,
financial advisors, and affluent families create and manage wealth. As of
March 31, 2010, through its subsidiaries and partnerships in which the
company has a significant interest, SEI administers US$394 billion in mutual
fund and pooled assets and manages US$162 billion in assets. SEI serves
clients, conducts or is registered to conduct business and/or operations,
from numerous offices worldwide. For more information, visit
www.seic.com/enME/index.htm.

About Strategic Insight

Strategic Insight is a leading research firm for the fund and wealth
management industry, providing clients with industry data and consulting
services for product, distribution and business strategy decisions. Strategic
Insight assists over 250 firms worldwide, and its Simfund databases and
analytical platforms cover more than 70,000 funds around the world. For more
information, visit www.Sionline.com. The company's parent, Asset
International, is an information provider to financial-services institutions,
including asset managers, global pensions, and others. Find out more at
www.AssetInternational.com.

Services provided by SEI Investments - Global Fund Services Limited (Reg.
in Dublin No. 424309), SEI Investments Trustee & Custodial Services (Ireland)
Limited (Reg. in Dublin No. 315393), and their affiliates, which are all
wholly owned subsidiaries of SEI Investments Company.

SEI Investments - Global Fund Services Limited and SEI Investments
Trustee & Custodial Services (Ireland) Limited (Styne House, Upper Hatch
Street, Dublin 2, Ireland) are authorised by the Financial Regulator under
the Investment Intermediaries Act 1995.

This material is not directed to any persons where (by reason of that
person's nationality, residence or otherwise) the publication or availability
of this material is prohibited. Persons in respect of whom such prohibitions
apply must not rely on this information in any respect whatsoever.

    Available Topic Expert(s): For information on the listed expert(s), click
    appropriate link.
    Phil Masterson
    https://profnet.prnewswire.com/Subscriber/ExpertProfile.aspx?ei=94577

Dana Grosser, SEI, +1-610-676-2459, dgrosser at seic.com; or Rory King or Katy Hall, both of Penrose Financial, (+44)0207-786-4888, seiims at penrose.co.uk