Hedge fund managers better start putting up because endowments and foundations are getting tired of paying up. NEPC, one of the largest investment consulting firms to endowments and foundations, today published the results of its second quarter Endowment and Foundation Poll, a measure of confidence and sentiment related to the economy, investing and market performance. The poll included a special focus on how endowments and foundations view hedge funds and respondents cited strong concerns about high fees, underperformance and transparency. 'While hedge funds play an important role in many institutional portfolios, the last several years have been difficult for the industry and investors are starting to look very closely at how hedge funds can work for them,' said Cathy Konicki, Partner and Head of NEPC's Endowment & Foundation Practice Group. According to the survey, 24% of respondents cited having zero exposure to hedge funds, which is a significant increase from the Q2 2014 NEPC Endowment and Foundation Poll, when only 2% reported having no exposure. And while 39% of respondents in the Q2 2014 Poll had 11% to 20% of their portfolio allocated towards hedge funds, in the Q2 2016 survey only 23% had the same allocation. Another concern cited by endowments and foundations was hedge fund fees, according to the NEPC survey. A quarter of survey respondents have asked for reduced fees or been offered reduced fees by their hedge fund managers within the past six months. When asked about the biggest challenges they face with their hedge fund investments right now, 'High Fees' was the second highest response (54%), topped only by 'Low/Disappointing Returns' (80%). As for which hedge fund strategies respondents are most bullish on, 36% think multi-strategy will generate the highest returns over the next three to five years. Other top results to this question include long/short equity (33%), global macro (25%) and credit (22%). Aside from the referendum on hedge funds, 50% of the survey's respondents say the U.S. economy is in a worse place now than it was this time last year. And 52% say a slowdown in global growth poses the greatest near term threat to their portfolios.