Fri, Aug 1, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

HFR: Hedge fund launches, liquidations accelerated in Q1 2012

Friday, June 15, 2012
Opalesque Industry Update – New hedge fund launches in 1Q12 increased to a level not reached since 2007 as hedge fund capital rose to a record level of $2.13 trillion, according to the latest Market Microstructure Industry Report, released today by HFR (Hedge Fund Research, Inc.), the global leader in the indexation and analysis of the hedge fund industry. New fund launches totaled 304 in the first quarter, narrowly eclipsing the 298 launches in 1Q11 for the highest quarterly total since 4Q07.

Hedge fund liquidations also increased during the first quarter, with 232 funds closing, the highest quarterly liquidation total since 240 funds closed in 1Q10. Fund of Hedge Funds (FOF) continued to experience a contraction in number of funds in the first quarter, with 64 FOF’s closing while 34 launched; 1Q12 was the 4th consecutive quarter of decline in number of FOF’s.

Hedge fund performance dispersion increased over the prior quarter, with the top decile of all hedge funds averaging a gain of over 20 percent in 1Q12, while the bottom decile of all funds declined by 28 percent on average. Dispersion over the trailing 12 months was essentially unchanged from the prior quarter. Hedge fund fees rose slightly in 1Q12 versus 1Q11, with average management fees of 1.63 percent and average incentive fees of 17.75 percent.

According to HFR’s research, service provider market share across prime broker, administrator, legal advisory and audit firms continued to fluctuate over the quarter, with J.P. Morgan and Goldman Sachs holding top PB shares with nearly half of all hedge fund assets globally. Administrators which experienced market share gains include BNY Mellon, GlobeOp and Citigroup.

“Innovative hedge funds are launching and finding opportunities as large financial institutions look to deemphasize trading activities as a result of anticipated regulation, realized trading losses and enhanced risk management requirements,” stated Kenneth J. Heinz, President of HFR. “Execution and risk control are integral components of successful hedge funds and these have been greatly enhanced by the evolution of transparency in recent years. These powerful trends will continue to support launches of new hedge funds designed to monetize inefficiencies in capital markets as financial institutions adapt to new reporting, risk and trading requirements.”

(press release)

HFR (Hedge Fund Research, Inc.) is the global leader in the alternative investment industry, specializing in the indexation and analysis of hedge funds. Established in 1992, HFR produces the HFRX and HFRI Indices, the industry’s most widely used benchmarks of global hedge fund performance. Source

Bg

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. Opalesque Exclusive: Kyria Capital Management bets on women hedge fund managers[more]

    Bailey McCann, Opalesque New York: As hedge fund assets top $3 trillion, and long/short strategies get more crowded than ever, with every manager hunting for even the tiniest bit of alpha, a new firm has emerged that claims its own edge – women. A recent Rothstein Kass study showed women-owned a

  2. The Big Picture: Charlemagne Capital smoothes risk out of frontier market investing with portfolio approach[more]

    Benedicte Gravrand, Opalesque Geneva: Opalesque recently talked to one of the portfolio managers of the Oaks funds, which are emerging and frontier market hedge funds focusing on equity long/short with a directional approach. They are run by

  3. Winton’s low-cost equities fund tops $1bn for first time[more]

    From FT.com: Winton, the London-based hedge fund, has increased the assets in its low-cost equities fund to more than $1bn for the first time in a sign that traditional stock managers may come under increasing pressure from computer-driven rivals. Winton, which manages about $25bn in total ass

  4. Opalesque Exclusive: Q2, H1 end positively for hedge fund performance[more]

    Bailey McCann, Opalesque New York: New hedge fund monitor data from Citi Prime Finance shows that overall, hedge funds ended the month of June and the first half of the year positively. Composite hedge fund performance, equal-weighted across funds, ranged from +0.93% to +1.73%. June-14 performa

  5. Many CTAs have become more short-volatility in the last five years[more]

    Benedicte Gravrand, Opalesque Geneva: Quantitative easing has reduced and then suppressed volatility for the last five years. So analysts at R.G. Niederhoffer Capital Management recently examined if there had been a tendency for CTAs and hedge funds to adjust their styles to become more 'shor