Hedge Fund Liquidations Outpace Inflows in Q2, Q3

Nov 30 2007 | 11:41am ET

Total hedge fund assets increased in the third quarter, but assets lost in liquidations outpaced the increase from new fund launches in the second and third quarters, according to a new report.

First, the good news: Hedge fund assets increased by 3.3% in the third quarter to $2.68 trillion from $2.59 trillion in the second. New allocations to the hedge fund industry increased its total asset levels by an estimated $339 billion through the first three quarters of 2007, according to HedgeFund.net.

Emerging market hedge funds enjoyed especially swift inflows, with assets reaching an estimated $299 billion on the quarter, an increase of $48 billion through new allocations in the first nine months of the year. Specifically, the report says hedge funds investing solely in Brazilian markets have become a much larger portion of the total hedge fund assets dedicated to Latin America in the last year. Total assets in Brazil focused funds reached an estimated $7.7 billion in Q3, an increase of $3.3 billion in 2007 alone.

China-focused hedge funds continue to attract investors with total assets in these hedge funds reaching an estimated $22.8 billion, an increase of 89% through the first nine months of the year.

Natural resources-focused hedge funds have also fared well amassing some $170 billion in total assets through Q3, led by energy-focused funds with $133.8 billion.

However, problems in the credit markets affected inflows for structured credit hedge funds, which saw its total assets fall 9.9% in the quarter to an estimated $62.7 billion. The average structured credit hedge fund returned 2.2% year-to-date through September, according to the report.

HFN also estimates that 47.7% of all assets in hedge funds were allocated through funds of hedge funds last quarter, which is down from 48.2% in the second quarter.


In Depth

Why Ponzi Schemes Work: An In-Depth Look At The Allen Stanford Fraud

Dec 21 2014 | 10:30am ET

Texan Allen Stanford first appeared on the radars of financial regulators in 1997...

Lifestyle

Hedgie Funds US Squash Program

Dec 24 2014 | 8:46am ET

Squash, anyone?

Guest Contributor

EidoSearch’s Top Three Market Projections For 2015

Dec 23 2014 | 4:03am ET

It is that time of year again when prognosticators make their big market calls for...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.