Hedge Funds See Inflows Of Almost $40B In Q1

May 6 2014 | 10:37am ET

Investors poured $38.6 billion into hedge funds in the first quarter of 2014, the highest quarterly inflows since Q1 2011, according to BarclayHedge and TrimTabs Investment Research.

Inflows in March were down to $11.2 billion from a three-year high of $24.9 billion in February.

Overall industry assets climbed to a five-and-a-half-year high of $2.2 trillion in March, according to estimates based on data from 3,375 funds. Assets rose 19% in the past 12 months but were down 9% from the all-time high of $2.4 trillion in June 2008.

The monthly TrimTabs/BarclayHedge Hedge Fund Flow Report noted that the hedge fund industry earned just 0.02% in March but outperformed the S&P 500, which lost 0.8%. In the past 12 months, however, the industry has lagged the broader market significantly, returning 8.5% to the S&P 500's 22.0%.

Equity long-bias hedge funds, the best-performing category in the past 12 months, had a rough March, returning just 0.2% after hitting a six-month-high of 3.0% in February, said Sol Waksman, president and founder of BarclayHedge, in a statement.

The monthly TrimTabs/BarclayHedge Survey of Hedge Fund Managers finds that more than half of surveyed managers are neutral on the S&P 500 over the next 30 days, the highest level in two years, and the rest are evenly split between bullish and bearish. The majority favoring developed markets grew a bit slimmer as optimism on emerging markets climbed to a 13-month high.

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