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From Kirsten Bischoff, Opalesque New York:
The asset situation in the hedge fund industry is not so much about the outflows, but about the lack of new money coming in, Charles Biderman, Chief Executive Officer at Trim Tabs Investment Research commented to Opalesque. The firm, along with BarclayHedge, released the July asset flow information for hedge funds, and it showed that July marked the third outflow in four months, with another $2.9bn in assets leaving the industry that month.
While managers returned positive performance in July, they fell behind the broader markets (The S&P 500 returned a full five percentage points more than hedge funds). Now, as August comes to a close, and industry performance looks to be flat to slightly down in the worry is that on top of regular cyclical redemptions, investors will not be enticed to allocate any returning assets to hedge funds. The slow chipping away of industry assets has brought levels down to their lowest levels since November 2009.
While performance in August may be indicative of hedge funds' ability to protect assets (Dow Jones Industrial Average -2.79%, Dow Jones World Equities Index -2.41%), those funds that are incoming seem to be concentrated on strategies that have notched the best performance. CTAs saw $3.9bn in inflows and fixed income funds posted inflows of $1.2bn (the fifth month of...................... To view our full article Click here
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