Preqin: 51 Institutional Investors Join the $1 Billion Hedge Fund Club over the Past Year

Jun 3 2015 | 12:08pm ET

The worldwide Club of the largest investors in hedge funds has seen a net migration of 24 investors into the Club over the past 12 months, according to Preqin.

A total of 51 investors have increased their allocation to the asset class to over $1 billion, while 27 investors have seen their allocation fall below the $1 billion mark.

There are now a total of 227 investors around the globe that have $1 billion or more in assets invested in hedge funds, and collectively these investors have $735 billion invested in the asset class.

This represents 24% of the total capital invested in the industry, and is up 13% on the amount of hedge fund assets the Club had in their portfolios as of May 2014.

Other Key “$1 billion Club” Hedge Fund Investor Stats:

  • New Entrants: Private sector pension funds make up the largest proportion of new entrants over the past year, accounting for 29% of new members. Over three-quarters (77%) of new entrants are based in North America.
  • Breakdown of the Club: Public pension funds account for the largest proportion of capital invested in hedge funds by the Club (25%), despite a handful of high-profile exits from the asset class by these investors over the past year. Sovereign wealth funds follow this with 16% of the total capital invested by the Club.
  • Preferred Methods of Investing: 45% of the Club’s members solely target direct investments in hedge funds when committing to the asset class, compared to 33% of all other investors. The $1 billion Club are also less likely to invest solely with funds of hedge funds, with only 8% of members investing via this route.
  • Number of Investments: The average number of hedge funds that investors in the Club have in their portfolio is 30. This compares to only 8 hedge funds for all other investors.
  • Main Strategies Being Sought: Macro funds are the preferred strategy for the $1 billion Club investors, with 48% of members targeting this strategy over the next 12 months. This is followed by long/short equity being sought by 39% of investors.
  • Average Allocations: $1 billionn Club investors allocate 15.9% of their assets to hedge funds on average,compared to 14.3% of assets for all other investors. 

 

To see the full report, click here.


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