Saturday, 29 April 2017
Last updated 18 hours ago
Apr 20 2017 | 12:14am ET
Investors continued to allocate fresh capital to hedge funds in March, according to new data from eVestment, maintaining the momentum from earlier this year and booking the largest monthly net inflow tally in nearly two years.
Investors allocated $15.7 billion in new money to hedge funds during the month, eVestment noted Wednesday in its March 2017 Hedge Fund Asset Flows Report, and $21.9 billion in Q1 2017. Inflows for the period inflows were the industry’s largest positive numbers in 20 months, the company added, pushing total industry AUM to $3.107 trillion – only 2% from all-time high.
The renewed interest appears to be anchored at least partially by the industry’s strong performance late last year as well as the need to hedge looming geopolitical and business concerns, with macro funds, managed futures, and quantitative equity the clear favorites.
The company’s research also suggests potential consolidation trend in the industry is starting, with 52% of funds gaining assets while 48% lost assets. In addition, a greater proportion of all products, and large funds, losing 2% and 5% of AUM due to outflows than gaining the same amount from inflows. When these metrics are combined with strong overall net industry inflows, it is a strong sign of consolidation of assets among a smaller number of products, eVestment said.
Other highlights from the 2017 Hedge Fund Asset Flows Report:
“After the industry’s largest monthly outflow since April 2009 in December 2016, the flow landscape has steadily improved in each of the last three months,” said Peter Laurelli, eVestment’s head of research. “March inflows were the industry’s largest since August 2015, and the majority of new money is going into macro, managed futures and quantitative equity strategies.”
Atlanta-based eVestment was founded in 2000 by Jim Minnick, Matt Crisp and Heath Wilson. The company boasts one of the most comprehensive global databases of traditional and alternative strategies and provides institutional investment data intelligence and analytic solutions to clients worldwide.