Hedge Funds Up 5.6% In '12, Industry Grows By $75B

Jan 3 2013 | 11:45am ET

Last year was a difficult one for the hedge fund industry, with below-average returns, fewer launches, more liquidations and a barren capital-raising landscape.

The average hedge fund ended the year up only 5.63%, according to the Eurekahedge Hedge Fund Index, after a 1% jump in December. The Standard & Poor's 500 Index rose 16% on the year.

Still, hedge funds' performance accounted for most of the industry's growth in 2012—hedge fund managed $75 billion more at its end than at its beginning, and now have $1.78 trillion in total assets under management. But that was due to a pathetic fundraising environment: Net flows into the industry were just $19 billion, less than half 2011's figure. And all of it went to North American hedge funds; European, Asian and Latin American hedge funds all suffered net outflows regionally, according to Eurekahedge. Despite that, Latin America and Asia ex-Japan funds performed best, rising 11.2% and 10.5%, respectively.

More hedge funds debuted in 2012 than died; but both figures are on the wrong track. The 959 launches were fewer than in 2011, and the 860 closures were the most since the financial crisis.

Among strategies, distressed debt, fixed-income and relative-value did best, all rising by double-digits.


In Depth

Israeli Hedge Fund Harnesses Big Data

Jul 28 2014 | 8:10am ET

Apica Green is a multi-million dollar Israeli hedge fund that is based in Tel Aviv...

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