Sat, Feb 6, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge fund industry surpasses $2 trillion milestone

Tuesday, April 19, 2011

Kenneth J. Heinz
Opalesque Industry Update - Investor inflows in 1Q11 highest since 3Q07

Broad-based asset gains across fund strategies and sizes

Total capital invested in the global hedge fund industry exceeded $2 trillion for the first time in its history, according to data released today by Hedge Fund Research, Inc. (HFR), the leading provider of hedge fund industry data. Total industry assets rose to $2.02 trillion, an increase of $102 billion in 1Q11, surpassing the previous record of $1.93 trillion, set in 2Q08. The current asset level reflects an increase of over 50 percent from the Financial Crisis low of $1.33 Trillion in 1Q09. Investors allocated $32 billion in net new capital in 1Q, the largest quarterly net inflow since 3Q07.

All strategy areas experienced inflows for the quarter, with the distribution of flows suggesting that allocators hold constructive yet dispersed views of the best strategic opportunities across the industry. Relative Value Arbitrage and Macro strategies posted the largest investor inflows, with each capturing approximately $12 billion. Relative Value Arbitrage strategies, encompassing exposure to fixed income, convertible securities and credit markets, have posted monthly performance gains in 26 of 27 months since December 2008. Event Driven strategies experienced the smallest capital inflows, attracting $2.2 billion, despite producing the strongest area of industry performance in both 2010 and 1Q11, with gains of +11.9 percent and +3.54 percent. Investors allocated $6.4 billion to Equity Hedge strategies in 1Q11, more than double the $2.6 billion of inflow from FY 2010.

Inflows strong across all firm capitalizations as risk tolerance returns Investors allocated new capital to funds of all asset tiers, reflecting a moderation of the capital concentration in the industry’s largest firms. Though firms with less than $250 million manage less than 4 percent of total industry capital, these received nearly 7 percent of 1Q inflows. Firms with capital in excess of $5 billion received just over half of the 1Q inflow, slightly moderating the 63 percent of total industry capital managed by these firms. Fund of Funds experienced an inflow of nearly $4.8 billion, the largest quarterly inflow since 2Q08.

Across the industry, nearly 72 percent of all hedge funds experienced capital inflows for the quarter, while nearly two-thirds of all funds have reached their high watermarks in the trailing 12 months.

“The growth of the industry to surpass significant threshold levels of both investor capital and fund performance validates that the hedge fund industry has completed its recovery from the financial crisis,” stated Kenneth J. Heinz, President of Hedge Fund Research (HFR). “The strategic and structural qualities of investor accessibility and transparency, which have defined the evolution of the industry in past two years, will serve as the primary catalysts for growth to surpass future milestones.”

Source

(press release)

bc

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. How Einhorn survived a nightmare year[more]

    From Bloomberg.com: Even when a hedge fund has an awful year, which was the case for David Einhorn's Greenlight Capital, there are lessons to be learned. Many funds would have had a tough time surviving a year like Einhorn experienced in 2015, when all the stars seemed to align against him and Green

  2. Legal - Hedge fund founder wins early release in U.S. insider trading case, Gramercy seeking $1.3 billion from Peru over land-bond dispute[more]

    Hedge fund founder wins early release in U.S. insider trading case From Reuters/Streetinsider.com: Former hedge fund manager Doug Whitman on Tuesday won a reprieve from serving the remainder of his two-year sentence for insider trading after several judges expressed skepticism that his 2

  3. Investing - David Einhorn finds a winner in Michael Kors[more]

    From Thestreetinsider.com: Greenlight Capital hedge fund manger David Einhorn took his lumps in 2015. The fund lost over 20 percent on the year amid bets gone bad being long a plunging SunEdison and short a couple high-flying FANG stocks. However, today Einhorn is again showing his stock picking pro

  4. Investing - Avenue Capital's Marc Lasry: We like European bank loans, Comment: A bunch of hedge fund managers are chasing the 'dream of crushing a major structural problem'[more]

    Avenue Capital's Marc Lasry: We like European bank loans From CNBC.com: European banks are under immense pressure, but at least one prominent hedge fund has found what it thinks is a good opportunity in the wreckage. Marc Lasry, co-founder and chief executive of hedge fund Avenue Capital

  5. Computer-driven hedge funds make money during January’s selloff[more]

    Komfie Manalo, Opalesque Asia: Commodity trading advisers (CTAs) that use computer programs to guide how they trade, made millions of dollars during last month’s market selloff on the back of declining oil prices and global equities and big moves in currencies. Data provider