Sun, Mar 18, 2018
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge funds post inflow of $11.3bn in August, investors hungrier for risk - BarclayHedge/TrimTabs Research

Monday, October 11, 2010
Opalesque Industry Update - TrimTabs Investment Research and BarclayHedge reported that the hedge fund industry posted an estimated inflow of $11.3 billion (0.7% of assets) in August 2010, the largest inflow since February, after redeeming a total $3.1 billion (0.2% of assets) in June and July.

“Hedge fund managers exhibited caution in August and it served them well,” said Sol Waksman, founder and President of BarclayHedge. “The industry outperformed the market by a large margin. While the S&P 500 sank 4.7%, hedge funds posted a negative return of less than 1%.”

Hedge fund investors have grown hungrier for risk. Emerging Markets funds posted an inflow of $2.5 billion (1.3% of assets) in August following three straight monthly redemptions. Macro funds posted an inflow of $2.1 billion (2.3% of assets), the largest inflow since June 2008. Meanwhile, commodity trading advisors (CTAs) posted an inflow of $2.2 billion (1.0% of assets), the fifth straight inflow as well as the twelfth in 15 months. In contrast, funds of hedge funds redeemed $2.3 billion (0.4% of assets), the sixth outflow in nine months.

“We suspect hedge fund managers might invest aggressively in the current quarter,” said Vincent Deluard, Executive Vice President at TrimTabs. “The fresh cash flowing into the industry needs to be put to work. Further, about a third of managers are sitting on a year-to-date return of less than 1%, so they need to end the year with a bang in order to collect fat performance fees. Additionally, margin debt is relatively low and being able to borrow for virtually nothing provides a strong incentive to lever up.”

Like retail investors, hedge fund investors continue to flock to bonds. Fixed Income hedge funds posted an inflow of $2.3 billion (1.4% of assets) in August, the sixth inflow in seven months. Fixed Income funds boast a year-to-date return of more than 9%, far and away the best performance of any hedge fund strategy.

“We’re never keen on stepping in front of a speeding locomotive, but we are concerned about the $687 billion mom and pop have poured into bond mutual funds and ETFs since the start of 2009,” noted Deluard. “Given a 10-year Treasury yield of less than 2.5% and a two-year yield that rounds to zero, what will bond enthusiasts do when the piper demands to be paid?”

(press release)



What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Performance - Hedge fund mojo is back with investor hopes at six-year high, These hedge funds produce the most consistently great results[more]

    Hedge fund mojo is back with investor hopes at six-year high From Hedge funds on the heels of a surprisingly strong performance in 2017 are raising hopes for an encore. Investors expect their managers to return 8.5 percent in 2018, according to a Credit Suisse Group AG sur

  2. Investing - Hedge funds amass big bets against world's leading advertisers, Investor Elliott Management buys tiny stake in Wipro[more]

    Hedge funds amass big bets against world's leading advertisers From Hedge funds have amassed bearish bets of more than $3bn against the world's largest advertising companies in an attempt to profit as the industry undergoes ongoing wrenching disruption and slowing growth. Funds i

  3. News Briefs - Investcorp to launch a $100 million PE fund for Omani pension funds[more]

    Bahrain-based investment firm Investcorp will soon launch a $100 million fund dedicated to Oman's Pension Funds as part of its investment plan. 'The Opportunities Fund' will be focused on private equity investments in the U.S. and Europe and will target mid-sized companies across a broad range of se

  4. DoubleLine's Gundlach sees U.S. 10-year Treasury yield rising, weighing on stocks[more]

    From Reuters/ Jeffrey Gundlach, the chief executive of DoubleLine Capital and known on Wall Street as the "Bond King," said on Tuesday the yield on the U.S. 10-year Treasury note will likely move higher and pressure riskier assets including equities and junk bonds. Gundlach, on an

  5. SEC charges Theranos CEO Holmes with fraud[more]

    Bailey McCann, Opalesque New York: The SEC has charged Elizabeth Holmes, founder and CEO of Theranos and its former President Ramesh "Sunny" Balwani with raising more than $700 million from investors through an elaborate, years-long fraud in which they exaggerated or made false statements about t