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Alternative Market Briefing

Event-driven and special situations hedge funds enjoy a rise in assets

Tuesday, August 23, 2011

From Precy Dumlao, Opalesque Asia:

Event-driven and Special Situations hedge funds rose 4.1% or equivalent to $21.2bn in the first half of the year, bringing the group’s total assets under management (AuM) to $537.1bn halfway into 2011.

In his industry report furnished to Opalesque, HedgeFund.net Vice President – Research Division Peter Laurelli disclosed that performance accounted for a $6.9bn increase in assets of Event-Driven and Special Situations funds, while investors allocated an additional $14.1bn in first six months of the year.

"Despite the influx of assets, the recent trend is negative. In Q2, performance reduced AuM $6.3bn and investors redeemed a net $4.2bn. The rate of AUM change due to performance has led the ED/SS [Event-Driven/Special Situations] benchmark through July which is an indication that larger funds (which have a smaller representation) have outperformed smaller funds during the year," Laurelli said in HFN’s HFN Strategy Focus Report: Event Driven/Special Situations report.

The HFN Event Driven Index was -1.09% in June (+1.42% YTD). This compares to +0.65% YTD for equity hedge fund strategies, +4.06% for fixed income, -2.50% for commodity strategies and +0.39% for the broad hedge fund industry.

Other hedge fund indices reported losses for event-driven strategies in June. The Credit Suisse LAB Liquid Indices......................

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