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Capital invested into emerging markets hedge funds has reached a new record high during the first quarter of this year, with global investors allocating more money into emerging Asia and Russia, according to hedge fund data provider Hedge Fund Research.

From January to March, investors allocated at least $121bn into emerging markets hedge funds, effectively erasing the previous record of $117bn recorded in 2007. In a statement, HFR added that the, new record represents a 6.5% increase in assets, including an inflow of some $2.3bn in new capital, which was concentrated primarily in emerging Asia, as well as $5.1bn in performance gains mostly coming from Russia and Multi-EM regions.

In its report, the data provider disclosed that the HFRI Emerging Markets (Total) Index gained a modest +0.96% duing the first quarter of the year while April performance contributed a +1.83% gains bringing the YTD performance to +2.80%, effectively navigating early year inflation-sensitive declines through Emerging Asian economies, as well as social and political unrest across Middle East economies.

"Building on its industry-leading gains in 2010, Russia/Eastern Europe-focused funds continue to lead EM hedge fund performance thus far in 2011, with the HFRI Russia/Eastern Europe Index gaining +8.22 percent YTD through April. The weakest area of EM ......................

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