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By Beverly Chandler, Opalesque London:

HFN’s Hedge Fund Industry’s research report with early estimates for March shows continued inflows into hedge funds, with figures showing quarter one inflows at their largest since the third quarter of 2009. Emerging markets were the best performers while hedge funds returned an average of 0.06% and 1.37% year to date, against the S&P Total Return Index return of 0.04% in March and a gain of 5.92% for the first quarter of 2011.

Hedge fund assets, according to the report, increased an estimated 0.41% in March to $2.547 trillion. Investors added a net $12.4 billion during the month for a core growth rate of 0.49%. This figures showed a decline from February, but well above the average for 2010. HFN defines core growth as the percentage increase in AUM due solely to net investor inflows.

More encouraging news came in the finding that in the first quarter 2011, investors allocated an estimated net $42.4 billion. The report says: "This is the largest quarterly net inflow since investors allocated a net $53 billion in Q3 2009."

March saw something of a rebound in emerging markets, with funds investing in India and Brazil achieving the best returns. However, the report notes that: "Despite the strong month, funds investing in China, India and the MENA region are down an average of -1.12%, -6.76% and -4.81% in 2011. Russia focused funds are the leading EM group in 2011, +7.04% in the first quarter."

Unsurprisingly given the d......................

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