Hedge Funds Lose $350B To Poor Performance, Redemptions

Jan 14 2009 | 12:38am ET

The global hedge fund industry contracted by almost 20% last year, with $350 billion falling victim to the twin terrors of poor performance and investor redemptions.

Hedge funds now manage about $1.5 trillion, according to preliminary estimates by Eurekahedge. The industry once boasted as much as $1.9 trillion in assets under management.

Most of the asset evaporation took place during the last quarter, when 90% of the money was lost. On the year, Eurekahedge estimates that the average hedge fund lost 12.3% of its value as the credit crisis battered most asset classes.

Most of the lost assets came from North American hedge funds, which saw $183 billion disappear, Eurekahedge said.

Eurekahedge’s estimates are based on reports from 39% of the funds that disclose their performance to the data provider, which means that the figures could get worse. Poor performers tend to report their performance later than those doing relatively better.


In Depth

Israeli Hedge Fund Harnesses Big Data

Jul 28 2014 | 8:10am ET

Apica Green is a multi-million dollar Israeli hedge fund that is based in Tel Aviv...

Lifestyle

David Yarrow On Growing His Hedge Fund And Shooting The Animals And People Of Africa - As A Photographer

Jul 23 2014 | 6:44am ET

While he’s always been a photographer, recent expeditions to Iceland, Ethiopia...

Guest Contributor

Compelling Opportunities In The Alternatives Space

Jul 29 2014 | 9:33am ET

In an environment where many asset classes seem expensive by historical standards...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note