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From Kirsten Bischoff, Opalesque New York: 2008 will likely go down as one of the worst years for the hedge fund industry. While hedge funds have, for the most part, managed to keep losses down in comparison to wider financial industry indices, investors are expressing their anger in the industry’s previous claims to generate returns through all markets. Investor dismay has been compounded by everything from fraudulent activity to managers barring redemptions. However, amidst all of this, Opalesque has been able to report many funds with positive performance YTD.
For these funds, one would think that positive outperformance in such turbulent times would bring a flood of assets. After all, there were many investors at the beginning of the summer saying that the markets were giving them a chance to see which manager strategies legitimately created alpha, as opposed to those funds surfing the bull markets.
A few short weeks ago, it looked as though these hedge funds would be able to target fund of funds and institutional investors by the end of the first half of 2009. Many suspected that investors were “over-redeeming” through the end of the year, anticipating their own investor cash needs. Expectations were that these raised levels of cash would be redeployed to those funds that had shown consistent performance throughout this time. However, the ripple effects of so many different things leave some seeing that...................... To view our full article Click here
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