Hedge funds perform well
Hedge funds pulled in $9.5bn (£6.3bn) during the second quarter, with nervous investors preferring to send their money to the biggest and best established managers, according to industry tracker Hedge Fund Research (HFR).
Hedge fund managers have seen flat returns on average as they have battled a volatile market so far this year, but that hasn’t stopped wealthy investors from sinking more cash into the industry. Strategies like global macro and event-driven funds that seek to insulate investors from stock market swings, have been particularly attractive.
The fund industry’s most established firms with more than $5bn in assets under management, saw $8.8bn of the total inflows in the second quarter, according to HFR.
“The hedge fund industry continues to be dominated by investor preference for robust fund infrastructure, encompassing enhanced liquidity and transparency,” Ken Heinz, president of HFR, said.
Overall, hedge fund performance declined by about 0.2 per cent in the first half of 2010, according to HFR. While the performance may seem shabby compared to blockbuster 2009 returns, hedge funds have shown that they are getting better at holding onto investor capital.
Global macro, event-driven and fixed income arbitrage funds have been the best performing funds so far this year and also attracted the most new capital, according to data from Credit Suisse.