SS&C GlobeOp: Forward Redemption Indicator Drops to 2.6%

Jan 24 2017 | 7:14pm ET

Redemption pressures in the hedge fund industry have lessened since the end of the year, according to new data from SS&C GlobeOp.

The company’s widely followed SS&C GlobeOp Forward Redemption Indicator, a metric used to gauge investor withdrawals from hedge funds, measured 2.60% for January 2017, sharply down from 5.67% in December and 4.25% in November.

"SS&C GlobeOp's Forward Redemption Indicator for January 2017 was 2.60%, up from 2.31% reported a year ago for January 2016," said Bill Stone, chairman and CEO of SS&C Technologies, in a statement. "Although somewhat higher than last year's level, the increase was well within the normal range of variation.”

Overall, the 2.60% for January 2017 was the fourth lowest month of redemptions in the past five years," Stone added. 

SS&C GlobeOp's Forward Redemption indicator is published on the 15th business day of every month. It represents the sum of forward redemption notices received from investors in hedge funds administered on the SS&C GlobeOp platform, divided by assets under administration at the beginning of the month, and is useful in measuring the pipeline of hedge fund investors asking for their money back.

Decreases in the indicator generally reflect increasing confidence in hedge fund allocations, while increases suggest the opposite. The indicator reached a high of 19.27% in November 2008 and a low of 1.85% in January 2012.

Windsor, CT-based SS&C’s clients represent about 10% of assets invested in the hedge fund sector. Founded in 1986, the company provides investment and financial software-enabled services to more than 10,000 financial services organizations that manage an aggregate $44 trillion in assets.

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