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Fifty-seven new funds began trading in Europe in 2022, down from 74 in 2021, which was boosted backlog of start-ups delayed by the coronavirus pandemic. Just 45 launches got going in 2020. Last year's launches managed assets of $6.8bn at year-end, the lowest total since 2016, when new European funds raised $6bn.

The bulk of the new funds began trading in H1 2022, with 35 getting underway. There were 22 that launched in the second half.

Former Credit Suisse trader Hamza Lemssouguer's Arini was among the largest launches to begin trading in 2022, raising just shy of $1bn.

Other larger launches were largely led by existing firms, including a discretionary macro strategy from Fulcrum Asset Management and an alternative markets-focused CTA launched by Winton Group.

Assets raised by new funds last year averaged $120m, down from around $160m in each of the two prior years.

Credit ($2.4bn), macro ($1.9bn) and managed futures ($995m) launches raised the most investor capital in 2022, according to the data, with various equity and event-driven approaches attracting the least.

The renaissance in demand credit hedge fund strategies has also been reflected in surveys of investor allocation preferences for 2023. The rise in capital raised by managed futures start-ups coincided with some of their best-ever returns.

Capital raised by equity-focused launches saw a huge year-on-year drop - from $5.6bn across 25 funds in 2021 to just $650m among 13 funds last year.

Long/short equity strategies were one of the worst hedge fund performers last year, down 9% on average, although European-focused strategies fared slightly better, down 5%, according to latest With Intelligence data.

Ucits launches bucked that trend, with equities-focused strategies, which more neatly fit in Ucits vehicles than other strategies and are more attractive to European allocators, accounting for over $1bn of the near $1.25bn raised.

The UK remained the dominant hedge fund start-up hub in Europe despite post-Brexit questions around London's status as the region's top financial center, and an expansion of established hedge funds to Paris and other European banking centers. Sweden saw up uptick in fund launch activity following the closure of a number of established firms.

Several high-profile launches are expected in Europe in 2023 with industry observers cautiously optimistic about the start-up space, citing increasing investor demand for inflation hedging tools and volatility management.

At least 37 European funds in development slated for a 2023 launch had been tracked by With intel by the end of Q1.

Press release

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