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Alternative Market Briefing

eVestment: Hedge fund asset flows mixed in 2018

Friday, January 25, 2019

Bailey McCann, Opalesque New York:

Forty-two percent of hedge fund managers were able to raise new capital in 2018, but those that saw redemptions and/or lost money were in the majority, according to the latest hedge fund asset flows report from eVestment.

Investors removed -$19.64 billion from the industry in December, bringing total 2018 investor redemptions to -$35.3 billion, the second highest level since 2009. Performance-related asset declines hit -$52.4 billion during the year, coupled with those investor redemptions, reducing total industry assets by -$87.7 billion. The industry ended 2018 with about $3.189 trillion AUM.

On a strategy basis, investors redeemed heavily from directional equities in December. Investors pulled -$13.69 billion from long/short equity as a result of poor performance.

Multi-Asset funds were the biggest asset losers in 2018, with investor redemptions at -$38.5 billion.

Market Neutral Equity funds were the big winner in asset flows for 2018, with investors adding +$12.51 billion to these funds during the year, the most of any fund type for the year. Two other strategies also pulled in assets - MBS Strategies (+$8.01 billion) and Macro funds (+$6.74 billion).

Notably, after six consecutive months of outflows from emerging market funds, investors returned to global markets in December. Investors found pockets of opportunity that turned asset flows into those funds positive (+0.28 billion) for the month.

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