814 new funds have launched so far this year, but slow third quarter; Emerging managers outperform HFRI Fund Weighted Composite Index.

New hedge fund launches slowed to conclude the volatile third quarter as total hedge fund industry capital posted a narrow gain to rise to a new record of $2.82 trillion. New launches fell to 240 in 3Q14, the lowest quarter since one year ago in 3Q13, as reported in the latest HFR® Market Microstructure Industry Report, released this month by Hedge Fund Research.

Year to date, 814 new funds have launched while new launches in the trailing four quarters totaled 1,058, in line with the full-year total for 2013 (1,060), which was the lowest annual launch total since 2010.

Emerging hedge fund managers, defined as those with track records of less than 24 months, outperformed the broad-based HFRI Fund Weighted Composite Index in both 3Q14 and YTD. Emerging Managers posted gains of +0.8 percent in 3Q14, while the HFRI Fund Weighted Composite Index posted a decline of -0.3 percent; YTD through 3Q, Emerging Managers have gained +4.7 percent, while the HFRI FWC gained +2.85 over the same time period.

Hedge fund liquidations increased over the prior quarter in 3Q14 with 200 hedge funds liquidating, though this number represents a YoY decline from the 3Q13 liquidation total of 222. In the trailing 12 months, 957 funds have liquidated, topping liquidations in each of the prior 4 years, and representing the highest total since 1,023 funds closed in 2009. ( Full press release). Ex-hedge funders striking out on their own:

Simon Davies, who managed money at Cheyne Capital Management LLP for 11 years and left in September, plans to start trading an event-driven fund with ......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.