- Advertisement -
- Advertisement -

Related

Hedge Fund Outflows 2016 Worst Year Since 2009?

Report: Alternative Fixed Income

- Advertisement -

Stockholm (HedgeNordic) – According to the latest eVestment Hedge Fund Assets Report, hedge fund outflows increased markedly in July, with investors redeeming an estimated net $25.2b from hedge funds in July. This follows outflows worth $23.5b in June, with this latest wave of redemption pressure bringing YTD flows to a negative $55.9b.

According to eVestment, mediocre performance is the prime reason behind the redemptions, with losing funds in 2015 being the primary source of outflows throughout 2016 into July. Redemptions have also accelerated within funds in June and July. The funds reporting the 10 largest outflows in July returned an average of -4.1% YTD and average losses of -5.3% in Q1 2016. By contrast, numerous funds received new allocations in 2016, including in June and July, with the largest 10 new allocations going to funds that have produced an average return of nearly 7% in 2016 and delivered positive returns on average in 2015.

Among these, commodity funds have consistently attracted new allocations this year. Investor sentiment towards commodity funds has remained positive for 14 months, during which time investors have added an estimated $10.3b. Managed futures have also delivered in 2016, supported by commodity-focused funds operating in futures markets. Redemption pressures are also emerging within some of the large, archetypal managed futures funds, however, likely due to elevated losses between March and May.

Redemptions were largest among multi-strategy funds, credit strategies, which suffered from performance, and event driven and macro funds, where redemptions in June and July have come from activist strategies and special situation credit funds. According to eVestment, Multi-strategy funds haven’t suffered this badly since the European sovereign crisis in April 2012, and credit strategies haven’t had such large non year-end redemptions since September 2011.

The redemption pressures facing the hedge fund industry in the past two months are reminiscent of the second half of 2011, according to eVestment, when investors redeemed an estimated $42b across 4 months. 2016 will be the third year on record with net annual outflows unless pressures recede, and the first since 2008 and 2009 on the heels of the global financial crisis.

 

Picture: (c) Carsten-Reisinger—Fotolia.com

Subscribe to HedgeBrev, HedgeNordic’s weekly newsletter, and never miss the latest news!

Our newsletter is sent once a week, every Friday.

Glenn Leaper, PhD
Glenn Leaper, PhD
Glenn W. Leaper, Associate Editor and Political Risk Analyst with Nordic Business Media AB, completed his Ph.D. in Politics and Critical Theory from Royal Holloway, University of London in 2015. He is involved with a number of initiatives, including political research, communications consulting (speechwriting), journalism and writing his post-doctoral book. Glenn has an international background spanning the UK, France, Austria, Spain, Belgium and his native Denmark. He holds an MA in English and a BA in International Relations.

Latest Articles

Asilo Argo Shifts Portfolio Focus Toward AI

Stockholm (HedgeNordic) – At Asilo Argo, portfolio managers Ernst Grönblom and Henri Blomster employ a high-conviction strategy aimed at identifying “future superstar” stocks. With...

Tessin Doubles Stake in Alfakraft Fonder

Stockholm (HedgeNordic) – Tessin, a Swedish digital investment platform for real estate financing, has agreed to double its stake in alternative asset manager Alfakraft...

Tech Power-Up for Tidan with CTO Appointment

Stockholm (HedgeNordic) – Tidan Capital has transformed from a single-strategy fund into a multi-fund boutique, a shift that demands robust technology infrastructure. To support...

Five Years In: From Quiet Start to Strong Finish

Stockholm (HedgeNordic) – Nordea Asset Management’s Copenhagen-based office is home to a team of portfolio managers and analysts dedicated to capturing relative-value opportunities in...

Month in Review – November 2024

Stockholm (HedgeNordic) – As the year approaches its end, the Nordic hedge fund industry is on track for its third-best performance on record and...

Origo Fonder Shifts Gears with Per Johansson as Co-CIO

The summer of 2024 brought an injection of momentum for fund boutique Origo Fonder, as Bodenholm founder Per Johansson joined as Co-Chief Investment Officer...

Allocator Interviews

In-Depth: Megatrends

Voices

Request for Proposal

- Advertisement -