Thursday, 28 August 2014
Last updated 8 hours ago
Nov 20 2008 | 1:45am ET
In the not-too-distant past, it looked like hedge funds were poised to blast through the $2 trillion barrier (some estimates say the industry already has). But with hedge funds in crisis, Citigroup says they may have to settle for half that.
Worldwide hedge fund assets may fall to about $1 trillion by the middle of next year, which would be a year-on-year decline of almost 50%, analyst Tobias Levkovich wrote in a report on the industry. Investors are poised to pull some 20% of their money from an industry already battered by redemptions and double-digit losses.
“The so-called ‘Swiss hot money’ wants out and funds are responding,” according to Levkovitch. “Citi’s credit analysts estimate that hedge funds have raised cash to roughly 40% of assets already in anticipation of known redemptions and possibly unanticipated demands from investors.”
What’s more, the newer, smaller hedge fund industry may have to make do with less leverage to boost returns, Levkovitch predicts.
“The future of the hedge-fund industry looks set to be one in which leverage will not be used as aggressively, partially as a result of recent losses but also because the prime brokers will not provide it easily,” he wrote.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...