Mon, Dec 6, 2021
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge funds reverse two-month redemption trend in May

Thursday, July 18, 2019
Opalesque Industry Update - Hedge funds reversed a brief two-month redemption trend in May with $800 million in industry inflows, a turnaround from April's $9.4 billion in redemptions.

While the fund flow needle turned upward in May, the month's inflows represented a negligible portion of industry assets, according to the Barclay Fund Flow Indicator published by BarclayHedge, a division of Backstop Solutions.

Strong U.S. economic indicators, an equity market rally that saw the S&P 500 making up ground lost in late 2018 and four consecutive profitable months for hedge funds was enough to overcome the redemption impact of Brexit worries and worries over an economic slowdown elsewhere in the world.

Data from the nearly 6,000 funds (excluding CTAs) included in the BarclayHedge database showed flow activity evenly mixed among regions of the world in May. The $10.6 billion in inflows to hedge funds in the U.S and its offshore islands, 0.7% of assets, went a long way toward offsetting the impact of $7.5 billion in redemptions in Continental Europe, 1.1% of assets, and $5.8 billion in May outflows, 1.0% of assets, in the U.K. and its offshore islands.

"An equity market rally coupled with strong U.S. economic news - highlighted by first quarter economic growth exceeding expectations - drove U.S. hedge fund investment and tipped the global balance toward hedge fund inflows in May," said Sol Waksman, president of BarclayHedge. "That said, ongoing Brexit concerns and downward revisions of economic growth projections in Europe and China drove redemptions in other regions of the world."

For the 12 months ending May 31, the hedge fund industry saw $151.0 billion in redemptions, 5.0% of industry assets.

While redemptions remained the norm for most hedge fund sectors over the 12-month period ending May 31, three sectors did post net inflows for the period. Macro funds experienced $15.6 billion in inflows, 7.6% of assets, over the 12 months, while Event Driven funds took in $9.9 billion, 6.9% of assets, and Merger Arbitrage funds added nearly $902 million, 1.4% of assets.

Investor concerns with regard to continued Fed tightening and doubts about whether the 10-year long bull market in equities was coming to an end continued to be reflected in the redemption trends of several sectors. Equity Long/Short funds experienced $31.1 billion in outflows, 13.9% of assets, Fixed Income funds saw $28.1 billion in redemptions, 4.9% of assets, Balanced (Stocks & Bonds) funds saw $27.8 billion in outflows, 11.3% of assets, and Equity Long Bias funds saw 12-month redemptions totaling $25.8 billion, 8.0% of assets.

For managed futures funds the redemption trend extended to 11 months in May. The month's redemptions stood at $3.8 billion, 1.2% of assets, up from $400 million in April outflows. For the 12-month period ending May 31, managed futures funds experienced $17.7 billion in redemptions, 4.8% of assets.

What do you think?

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

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. SPACs: Trump-tied SPAC seeks Wall Street support, Nextdoor surges in public market debut after SPAC merger, Barrows Hotel Enterprises considers SPAC merger, Aussie SPAC targets big deal after NASDAQ IPO[more]

    Trump-tied SPAC seeks Wall Street support From Al Jazeera: Day traders and Reddit enthusiasts helped fuel a spectacular rally in Digital World Acquisition Corp shares, which reached a closing high of $94.20 last month before leveling out to recently trade around $60. The blank-ch

  2. Tiger funds change some stripes, Melvin Capital's comeback plan, What's behind Sachem Head's surge?, One of Asia's oldest hedge funds is buying distressed China debt[more]

    Tiger funds change some stripes From Institutional Investor: Falcon Edge, Light Street, Lone Pine, Viking, and Hound made significant buys and sells in the third quarter. Falcon Edge Capital Management exited its two largest U.S. long positions in the third quarter, according to

  3. SPACs: Hambro Perks eyes first London SPAC listing under new rules, SPACs churn out restatements, again, to correct accounting, Investment manager's SPAC Investcorp Europe Acquisition I files for a $250m IPO[more]

    Hambro Perks eyes first London SPAC listing under new rules From Bloomberg: U.K. venture capital firm Hambro Perks Ltd. aims to raise 140 million pounds ($187 million) listing a special purpose acquisition company in London, in what could be the market's first major blank-check offerin

  4. Opalesque Exclusive: TRF - the right product at the right time (part 1)[more]

    B. G., Opalesque Geneva: Eurex, an international derivatives exchange and a member of the Deutsche Börse Group, has been churning out its pioneering Total Return Futures (TRF) since 2016. In a

  5. Coinbase co-founder launches biggest VC fund in crypto, Valkyrie launches $100m DeFi hedge fund, Kyle Bass says the big money has been made in bitcoin[more]

    Coinbase co-founder launches biggest VC fund in crypto From the FT: Coinbase co-founder Fred Ehrsam and former Sequoia Capital partner Matt Huang have finished raising $2.5bn this month for Paradigm One, their first venture capital fund. Investors jockeyed to commit money to the fund, allo