Mon, Jul 24, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Inflows, performance bring total hedge fund assets to $2.25tln in Q4-12; HFR launches HFRU family of UCITS hedge fund indices

Friday, January 18, 2013
Opalesque Industry Update – Steady inflows and performance-based gains increased hedge fund assets by $60 billion in the fourth quarter, bringing total industry capital to a record $2.25 trillion, according to the latest HFR Global Hedge Fund Industry Report, released today by HFR, the established global leader in the indexation, analysis and research of the global hedge fund industry.

Hedge funds posted performance gains in 4Q12, as global financial markets struggled with the political and macroeconomic uncertainty which had adversely impacted performance throughout much of the year, including the European banking and sovereign debt crisis, and the U.S. fiscal cliff negotiations.

The HFRI Fund Weighted Composite Index advanced +1.3 percent in 4Q, topping the global equity market decline, and bringing full-year 2012 HFRI FWC Index performance to +6.2 percent. Investors continued to allocate new capital to the hedge fund industry, with net asset inflows of $3.4 billion in 4Q, bringing total 2012 inflows to $34.4 billion.

Full year performance gains and capital inflows by strategy were led by fixed income-based Relative Value Arbitrage (RVA). The HFRI Relative Value Index was up +10.5 percent for 2012, the fourth consecutive calendar-year gain; the RVA Index has generated positive performance in 41 of 48 months since the nadir of the Financial Crisis in December 2008. Investors allocated $6.5 billion of new capital to RVA in 4Q, bringing full-year capital inflows to $41.4 billion; these inflows vaulted RVA to the largest strategy area of hedge fund capital with $609 billion, overtaking Equity Hedge as the top strategy area for the first time since 1991.

Event Driven was the top-performing strategy in 4Q with a gain of +3.22 percent, finishing the year up +8.6 percent. However, investors also withdrew capital from this strategy, resulting in a 4Q12 outflow of $3.5 billion and completing a year that saw total net redemptions of $6.6 billion from Event Driven funds. Total assets in Event Driven strategies ended 2012 with $558 billion. Equity Hedge strategies turned in positive performance in the volatile 4Q12, with the HFRI Equity Hedge Index gaining +1.86 percent. Despite this 4Q gain, investors withdrew $1.2 billion from Equity Hedge funds in 4Q12 and a total of $10.4 billion on the year. Total assets in Equity Hedge strategies finished 2012 at $598 billion.

Macro hedge funds posted a decline for 2012, with the HFRI Macro Index falling by -0.40 percent, with losses in Systematic/Quantitative CTA strategies. The HFRI Macro: Systematic Diversified Index fell by -2.7 percent in 2012 on weakness in Currencies and Commodities. Despite the performance decline, investors continued to favor Macro strategies in 2012, as Macro funds experienced net inflows of $1.66 billion in 4Q and $10.3 billion for the full year; assets managed by Macro hedge funds ended 2012 at $488 billion.

HFR launches HFRU Indices, designed to track hedge funds compliant with UCITS guidelines
HFR also announced the launch of the HFRU family of indexes, including the HFRU Hedge Fund Composite Index, which gained +4.9 percent in 2012. The HFRU Indices are published on a daily basis and comprise the most comprehensive benchmarks of UCITS hedge fund performance available. HFRU Indices are representative of the complete universe of hedge funds compliant with UCITS guidelines, and include four strategy indices (Equity Hedge, Event Driven, Macro and Relative Value Arbitrage) and an aggregate HFRU Hedge Fund Composite Index. The HFRU joins the HFRI and HFRX families of indices, which are both the premier, industry-standard benchmarks of hedge fund performance.

“Performance and capital flow trends, including the rise of Relative Value Arbitrage funds and the proliferation of hedge funds compliant with UCITS guidelines, reflect a significant and fundamental shift in the hedge fund landscape as the industry evolves to meet investor requirements in coming years,” stated Kenneth J. Heinz, President of HFR. “Investor preferences have moved away from opaque, black-box, illiquid and high equity market beta strategies and have moved to embrace high quality strategies offering transparency, liquidity, tactical flexibility, strategic innovation, accessible account minimums, institutional risk management and consistent performance gains. In these ways, the evolved hedge fund industry will continue to appeal globally to individual investors as a vehicle to access sophisticated, transparent, long-short strategies, as well as to institutional investors as a powerful complement to existing equity and fixed income exposures.” www.hfru.eu.

Press release

www.hedgefundresearch.com

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. Launches - Crypto boom: 15 new hedge funds want in on 84,000% returns, Crypto madness is striking VCs as Union Square analyst leaves to start new fund[more]

    Crypto boom: 15 new hedge funds want in on 84,000% returns From Forbes.com: With 43 projects raising $1.2 billion in initial coin offerings since May 1, according to Nick Tomaino's The Control, and with stratospheric returns for so many ICOs -- 82,000% for Ethereum, 56,000% for IOTA, 44,

  2. FinTech - The machines are coming... Elon Musk's grim warning, Tezos' $232 million ICO may just be the beginning, A gentle introduction to Initial Coin Offerings (ICOs), Billion dollar tokens, ICOS & crazy market swings WTF is going on!?, How AI is changing the way we invest, How the tech revolution is bringing flip-flops and beanbags to Wall Street, A 'machine-learning' approach to venture capital[more]

    The machines are coming... Elon Musk's grim warning From Tenplay.com.au: Tesla chief Elon Musk has called on US Governors to take 'decisive' action to curtail "the greatest risk we face as a civilization": Artificial Intelligence, or AI. Speaking at a meeting of the National Governor Ass

  3. News Briefs – Sears inks $200 million credit line from CEO Eddie Lampert's hedge fund, shares jump 9%, Rwanda: Global hedge fund to increase investments[more]

    Sears inks $200 million credit line from CEO Eddie Lampert's hedge fund, shares jump 9% Sears Holdings has landed a fresh line of credit, valued at $200 million, from its CEO Eddie Lampert's hedge fund, the retailer said Monday. Sears' stock climbed about 9 percent higher Monda

  4. Despite current limits, robo-advisors will be preferred investment solution for retail, gain importance for affluent and high net worth[more]

    Matthias Knab, Opalesque: Flynt, a Swiss FinTech focusing on proprietary technology platform for private and institutional clients, has published a brief paper on "Investing in the world of robo-advice and passive instruments". As investors will become more reluctant to pay for investment advi

  5. Investing - Hedge fund CQS favors structured credit, Direct lending funds' fading all-weather appeal, Funds hunt for cracks in most-prized US shopping malls[more]

    Hedge fund CQS favors structured credit From BArrons.com: A hedge fund manager that can invest across the investment landscape says in his latest semi annual report this week that he's finding opportunities in structured credit -- particularly the shorter term, floating rate kind. Exampl