Hedge Fund Redemptions Rise As Cyprus Concerns Loom

Mar 21 2013 | 12:24pm ET

Investors filed more redemption notices this month than last, in line with expectations for the end of a quarter. But worries over Cyprus could push withdrawals even higher next month.

The SS&C GlobeOp Forward Redemption Indicator, which measures forward redemption notices received by hedge funds administered on the GlobeOp platform, ticked up to 4.33% this month. It was at 3.96% last month.

"March redemption activity increased slightly from February, reflecting heightened quarter-end activity," SS&C Technologies CEO Bill Stone said.

But the troubles in Cyprus, which this week rejected a European Union bailout deal that would have required a tax on bank deposits, have investors worried, meaning that April could see even bigger outflows.

"There's been volatility in markets, so you're going to see fund redemptions correlated with what's happening there," Stone told Reuters. "Cyprus has had an impact on short-term thinking."

Stone said he expects April's indicator to be higher than March's, with concerns about Cyprus combining with tax day in the U.S.


In Depth

Q&A: Sancus Capital And The Disruption Of The CLO Market

Oct 5 2017 | 6:28pm ET

Traditional collateralized loan obligation (CLO) funds in the U.S. market can offer...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Finding Success as Alternatives Converge

Oct 9 2017 | 4:00pm ET

Rising interest among institutional investors over the past several years has led...