Och-Ziff Flat After IPO

The hedge fund raised $1.15 billion in the offering.
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Shares of hedge fund

Och-Ziff Capital Management

(OZM)

were off slightly Wednesday morning following its IPO.

The New York-based fund, the first pure hedge fund to go public, was shedding 3.9% to $30.75 in early trading on the

New York Stock Exchange

. The stock priced at $32 a share.

Och-Ziff raised $1.15 billion in offering 36 million shares. The company offered underwriters, led by Goldman Sachs and Lehman Brothers, the option to buy an additional 5.4 million shares.

The company intends to use the proceeds and a concurrent sale of $1.15 billion in shares to Dubai International Capital to buy interests in its partners, who plan to immediately reinvest the money into certain funds it manages.

The lackluster debut for the stock does not come as a surprise as other alternative investment firms have struggled since testing the public waters earlier this year. Private-equity firm the

Blackstone Group

(BX) - Get Report

has slid 26.6% to $22.77 since pricing its IPO at $31 in June. The firm also on Monday reported it had

swung to a third-quarter loss stemming from charges related to its IPO.

Fortress Investment Group

(FIG)

on Tuesday also reported it had swung to a loss related to its IPO. But shares rallied as the firm said it planned to

step up investment in residential asset-backed debt, which has been hammered amid the ongoing credit crisis. Shares also are now trading below its $18.50 offering price in February, after reaching as high as $38.

Och-Ziff, founded in 1994 by

Goldman Sachs

(GS) - Get Report

alum Daniel Ochs, has $30.1 billion in assets under management. The fund boasts 700 fund investors.