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Performance gains in April nearly push hedge fund AUM back above $3tn, but redemptions persist

Friday, May 22, 2020
Opalesque Industry Update - Investors continued to pull money out of hedge funds in April, withdrawing $18.1 billion from hedge funds around the world last month, according to the just-released April 2020 eVestment Hedge Fund Asset Flows Report.

That was less than the $24 billion investors pulled from the industry in March, and performance gains brought overall industry AUM to $2.99 trillion, just shy of the $3 trillion mark industry AUM sank below in March. The last time industry AUM fell below $3 trillion was April 2014.

"In general, it appears investors are not reacting anywhere near as swiftly or as significantly - the aforementioned redemptions aside - as in 2008/2009," said eVestment Global Head of Research Peter Laurelli, referring to the 2008 financial crisis which had long-term negative impact on the industry. "This is a different industry with a different investor base compared to back then. However what is clear is that dissatisfaction with returns is a theme which never changes."

Among primary hedge fund strategies eVestment tracks, Distressed funds were the big asset winners in April, with investors putting $1.51 billion into those funds. Event Driven funds also saw new money, with investors sending $450 million in new money to these strategies. Both funds are positive for flows YTD as well.

Investors had a tepid interest in credit focused funds in April, with Relative Value Credit funds seeing $60 million in new money and Directional Credit funds seeing $40 million in new AUM.

Macro head funds were the biggest AUM losers among primary strategies eVestment tracks in April, with investors pulling $9.18 billion from these funds.

Managed Futures funds also saw signification investor redemptions in April, with investors pulling $4.18 billion from these strategies.

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