Global Hedge Fund Assets Grow To $2.6 Trillion

Apr 16 2008 | 12:14pm ET

Global hedge funds assets reached $2.65 trillion at the beginning of 2008, with over 390 firms in the Billion-Dollar Club, according to a new report.

The survey, compiled by HedgeFund Intelligence, shows the majority of the increase in aggregate assets under management last year was due to net inflows of new money from investors. The top 390 firms manage nearly 80% of assets globally. New York remains the hedge fund capital of the world, with 144 of the biggest firms based in the city, where they manage collective assets of $973 billion, up sharply from last year’s 123 firms with $1 billion or more of assets in the Big Apple.

Also, the growth rate of the industry in Europe (at 25%) was roughly in line with the rate of growth globally, with the total assets of European hedge funds up from $460 billion to nearly $575 billion. London continues to be the dominant centre in the European region, with 75 global billion-dollar firms headquartered there (three more than last year), with collective assets up from $261 billion to $348 billion. Just as in the U.S., the biggest firms in Europe are becoming more dominant, with the market share of the top 22 firms (with assets of over $5 billion each) rising from 37% to 44% of European assets during the year.

Assets in Asia-Pacific hedge funds rose at a slightly faster rate than the global average–over 30%, from about $148 billion at the start of 2007 to a $196 billion at the start of 2008. But this overall growth masks contrasting trends within the region, with huge growth in markets like China and India at the same time as significant net outflows last year from funds in Japan. While the importance of Tokyo as a hedge fund centre declined, there was particularly strong growth in both Hong Kong and Singapore, which now have a total of 19 global billion-dollar firms between them.

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