U.S. Dominates Hedge Fund Industry

Sep 19 2013 | 10:38am ET

U.S.-based hedge funds have bounced back from the financial crisis better than those in other regions and account for 73% of total hedge fund industry assets, according to new research from data provider Preqin.

U.S. funds have added $150 billion to their assets under management year to date, thanks in large part to performance, although Preqin points to some “significant” commitments to U.S.-based funds this year. By way of comparison, Europe-based hedge funds have added $33 billion to their AUM year-to-date.

New York remains the center of the hedge fund universe, London is second and Connecticut third. Ten states are home to 95% of all U.S.-based hedge fund assets: New York, California, Connecticut, Massachusetts, Illinois, Texas, New Jersey, Minnesota,  Pennsylvania and Florida.

U.S.-based funds of hedge funds dominate that segment of the industry, managing $508 billion or 65% of all FoF capital.

If you're not yet convinced of U.S. hedge fund hegemony, Preqin also notes that U.S.-based investors account for 55% of all institutional capital invested in hedge funds and U.S.-based funds have posted a net return of 13.54% over the past 12 months compared to a global benchmark of 11.09%.

“The U.S. is the undeniable center of the hedge fund industry, with more hedge fund managers and investors than anywhere else in the world,” said Preqin's Amy Bensted in a statement. “Although hedge funds have had a rocky few years globally, the recovery of the  U.S. hedge fund industry has been strong. In addition, U.S.-based institutional investors represent a vital source  of capital for hedge fund managers. These investors recognize the value that hedge funds can add to their portfolio, and have begun to allocate significant sums to hedge funds to complement their traditional equity and fixed-income portfolios.”


In Depth

'Smart Beta' Funds In Regulators' Sights, Hedgies May Be Next

Mar 26 2015 | 11:11am ET

Funds that mimic strategies used by active managers for a fraction of the cost could...

Lifestyle

Study: Both Marriage and Divorce Lead to Negative Hedge Fund Performance

Mar 25 2015 | 6:51pm ET

Trouble at home leads to trouble in the market for fund managers, according to researchers...

Guest Contributor

The Life Settlement: Yield For The Investor And Cash For The Consumer

Mar 31 2015 | 6:48am ET

Investors are languishing in a yield-starved, low-interest rate environment, looking...

 

Sponsored Content

    Mar 9 2015 | 6:35am ET

    Kelly RodriquesKelly RodriquesAs more investors look to diversify, many are beginning to use retirement funds to invest in alternative assets such as private equity and real estate. Kelly Rodriques, CEO & President of PENSCO Trust Company, explains how companies can connect with those looking to use their retirement accounts in a different way. Read more…

Editor's Note