Liquidations, Outflows Hit Hedge Fund Industry

Jun 9 2010 | 11:55am ET

Hedge fund liquidations and outflows are back on the rise, according to pair of new reports.

Some 240 hedge funds closed their doors in the first quarter, the first quarter in four to see an increase in hedge fund liquidations, Hedge Fund Research reports. Still, the number of new hedge funds exceeded the number of those folding during the quarter, with 254 launches.

Funds of hedge funds were not so lucky, with 102 shutting their doors during the year’s first three months, with liquidations outpacing launches. The last time more funds of funds debuted than departed was the second quarter of 2008, before the financial crisis hit its stride.

Overall, the hedge fund industry grew with $13.76 billion in net inflows and positive performance in the first quarter, according to HFR. But a chunk of that disappeared in April, according to another report.

Investors yanked $3.5 billion from hedge funds that month, according to BarclayHedge and TrimTabs Investment Research. It’s the third time in five months that investors fled the asset class.

“Recent flow weakness is surprising,” Sol Waksman of BarclayHedge conceded. “Industry performance has been stellar, and April is historically a strong month for subscriptions.”

Still, assets under management by hedge funds hit a 17-month high in April, thanks to strong investment performance.


In Depth

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Griffin Selling Chicago Apartment

Nov 26 2014 | 11:40am ET

Citadel Investment Group’s Kenneth Griffin is making clear to his estranged wife...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.