Fri, Mar 29, 2024
A A A
Welcome Guest
Free Trial RSS pod
Get FREE trial access to our award winning publications
Industry Updates

Hedge fund performance improves slightly, inflows $852m in May

Tuesday, July 10, 2012
Opalesque Industry Update: BarclayHedge and TrimTabs Investment Research reported today that the hedge fund industry took in a lackluster $852 million (0.05% of assets) in May, but that was an improvement over April’s net outflows of $3.2 billion. Based on data from 3,001 funds, the May TrimTabs/BarclayHedge Hedge Fund Flow Report estimated that the hedge fund industry assets stood at $1.72 trillion in May, down 2.0% from $1.76 trillion in April and down 29% from the peak of $2.4 trillion set in June 2008.

“The small inflows of May did not really buck the larger hedge fund industry trend of meager returns, flat asset growth, and net outflows over the past year,” said Sol Waksman, founder and president of BarclayHedge. Outflows from the industry totaled $18.8 billion from June 2011 to May 2012, compared to inflows of $96.2 billion for the previous 12 months while assets hovered around $1.7 trillion for the past nine months.

For the second month in a row, the hedge fund industry outperformed the benchmark S&P 500, but it still remained on the loss side. While the S&P Index fell 6.27% in May, the hedge fund industry had losses of 3.05%. For the first five months of 2012, however, the industry underperformed with a 1.8% return vs. a 4.2% gain for the S&P 500.

Waksman noted, “Hedge funds have underperformed the S&P500 on a trailing three-year basis for the past seven months, so the next several months will be telling in terms of whether the industry can get back to delivering sizable returns to its customers.”

Among the major hedge fund categories, Fixed Income funds have had the highest inflows and the best returns over the past year. “Fixed Income is in demand because low interest rates and easy monetary policies from central bankers have driven yields to record lows,” said Charles Biderman, founder and CEO of TrimTabs, who noted that Multi Strategy and Macro funds are also attracting investors because they can capitalize on political and financial turmoil like the Eurozone sovereign debt crisis.

Reflecting the debt crisis that has pummeled Greece and Spain, hedge funds based in Continental Europe lost 7.0% of assets in May and 25.5% of assets from June 2011 to May 2012. “We believe investors are looking to minimize their exposure to Europe and European financing while reallocating their assets to geographical regions they believe will benefit from a more stable financial system and currency,” said Leon Mirochnik, vice president at TrimTabs. Japan-based hedge funds were investor favorites, taking in the largest inflows among global regions for the past year (20.1% of assets) even as they generated some of the worst returns (-8.2%).

Meanwhile, the latest June 2012 TrimTabs/BarclayHedge Survey of Hedge Fund Managers found that 26.5% of managers were bullish on the S&P 500 for July, while 33.7% were bearish and 38.9% were neutral. Conducted in late June, the survey of 99 hedge fund managers found bullishness in terms of the S&P 500 at a 10-month low, while neutral sentiment climbed to just short of a 12-month high.

BarclayHedge

Press Release

BM

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Previous Opalesque Exclusives                                  
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. KKR raises $6.4bn for the largest pan-Asia infrastructure fund[more]

    Laxman Pai, Opalesque Asia: The New York-based global investment firm KKR has raised a record $6.4bn for its second Asia-focused infrastructure fund, underlining investors' continued appetite for private markets. According to a media release from the alternative assets manager, the figure top

  2. Bucking the trend, top hedge fund makes plans for a second SPAC[more]

    From Institutional Investor: SPACs aren't dead. At least not to the folks at Cormorant Asset Management. The life sciences firm, whose hedge fund topped its peers in 2023, is confident it will match the success of its first blank-check company. Last week, the life sciences and biopharma speciali

  3. Benefit Street Partners closes fifth fund on $4.7 billion[more]

    Bailey McCann, Opalesque New York: Benefit Street Partners has closed its fifth flagship direct lending vehicle, BSP Debt Fund V, with $4.7 billion of investable capital across the strategy. Benefit Street invests primarily in privately originated, floating rate, senior secured loans. The fun

  4. 4 hedge fund themes that are working in 2024[more]

    From The Street: A poor earnings report from Tesla (TSLA) has not hurt the indexes on Thursday. The decline in Tesla stock, which is losing its position in the Magnificent Seven pantheon, is more than offset by strong earnings from IBM (IBM) and ServiceNow (NOW) . In addition, the much higher-t

  5. Opalesque Exclusive: A global macro fund eyes opportunities in bonds[more]

    Bailey McCann, Opalesque New York for New Managers: Munich-based ThirdYear Capital rebounded in 2023, following a tough year for global macro. The firm's flagship ART Global Macro strategy finished the year up 1