2011 The Year Of The Smaller Hedge Fund, Agecroft Says

Jan 5 2011 | 10:34am ET

Less competition from larger hedge funds, increased flows from institutional investors and a banner year for startups are poised to reap new billions for smaller hedge funds, according to a new report.

Agecroft Partners’ Donald Steinbrugge said his prediction is based on conversations with more than 300 hedge funds and 1,500 institutional investors last year.

Over the past two years, as hedge funds struggled to recover both performance and lost assets suffered in the financial crisis, many long-closed, brand-name hedge funds reopened for the first time in years to new investors. And investors grabbed the opportunity, directing most of their billions to the biggest hedge fund firms.

But those hedge funds have refilled their coffers and are more reticent about accepting new money. But institutional and other investors ready to jump back into the asset class with both feet mean major opportunities for smaller funds.

“The end result is less competition for assets from the largest well-known hedge funds as investors shift their focus away from investing in brand names towards managers capable of generating future alpha,” Steinbrugge said.

And there will be plenty of new places for them to put their money: Steinbrugge says this year will be “the best year for hedge fund launches since 2007.”


In Depth

Change In 'Accredited Investor' Definition Could Hurt Crowdfunding Space

Jul 25 2014 | 8:14am ET

The Securities and Exchange Commission is considering changes to its 30-year-old...

Lifestyle

David Yarrow On Growing His Hedge Fund And Shooting The Animals And People Of Africa - As A Photographer

Jul 23 2014 | 6:44am ET

While he’s always been a photographer, recent expeditions to Iceland, Ethiopia...

Guest Contributor

The Truth About Track Record Portability

Jul 24 2014 | 5:55am ET

The number of private funds converting to mutual funds has increased significantly...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note