Cautious clients boost Gottex turnaround hopes

* Managed account unit doubles in size in Q3

* Fund of funds unit still seeing net outflows

* Partially deferred fee structure drawing interest By Martin de Sa'Pinto ZURICH, Oct 20 (Reuters) - Swiss hedge funds company Gottex GSMN.S saw assets rise for the first time in more than two years in the third quarter as clients wanting more control over their investments poured cash into segregated accounts.

Gottex Solutions Services, the managed account platform which last year won its first investment and advisory mandate from food group Nestle (NESN.VX), more than doubled in size to $1 billion in the quarter, helping push fee-earning assets up 7 percent to $7.8 billion.

"We are seeing a pick-up in activity in certain areas such as customised solutions and managed accounts as witnessed by GSS doubling its asset base," Gottex Chairman and CEO Joachim Gottschalk said in a statement.

Investor demand for managed accounts -- personalised portfolios which give investors visibility and control over their assets -- has grown since many funds restricted or blocked investor withdrawals during the financial crisis.

Gottex said the bulk of the inflows to GSS came from pension funds, banks and asset managers. Assets in Gottex's fund management arm slipped 1 percent to $6.75 billion as net investor withdrawals outweighed fund gains.

Gottschalk said, however, that industry growth could accelerate as investors start looking for higher risk-adjusted returns over the relative safe havens of cash and bonds.

The fund company said a new fee structure for some funds -- which would partially defer incentive fees payable when the funds achieve determined returns -- was attracting interest and could help flows to the unit turn positive again.

"We put this new fee structure in place to better align the long-term interests of Gottex with those of our clients. The response has been very positive from investment consultants and investors," said Max Gottschalk, head of its European business.

"I don't know of any major fund of funds that have implemented something like this yet," he added.

Founded in 1992, Gottex has seen its managed assets shrink by almost half since mid-2008. Nearly 90 percent of assets are from institutional investors. (Editing by Michael Shields) (For the Hedge Hub blog, visit: blogs.reuters.com/hedgehub/ For the Global Investing blog, visit: here)