- Advertisement -
- Advertisement -

Related

Hedge Fund Assets Edge Down in Third Quarter

Latest Report

This year’s Alternative Fixed Income report from HedgeNordic explores how institutional investors and asset managers are navigating this new reality, balancing yield and resilience amid shifting credit cycles, structural change, and evolving sources of return.

Stockholm (HedgeNordic) – Hedge fund industry assets dropped modestly to $3.24 trillion in the third quarter from the prior quarter’s record of $3.245 trillion. According to Hedge Fund Research (HFR), capital inflows to new hedge fund launches and the industry’s most established players were offset by outflows stemming from fund liquidations and investor redemptions from small- and mid-sized hedge fund firms. Net capital outflows in the third quarter amounted to an estimated $6.8 billion.

“Total hedge fund industry capital was little changed in 3Q as a number of contributing factors had partially offsetting impacts and influences, including, but not limited to, beta reducing rebalancing and reallocation, liquidations and launches, and an increase in market volatility associated with ultra-low interest rates,” said Kenneth J. Heinz, President of HFR, in a press release.

Hedge fund investors increased exposure to fixed-income and credit-based relative value arbitrage, and event-driven strategies, with investors positioning for ultra-low interest rates for the near term amid nearly $16 trillion of negative-yielding European government debt. Event-driven strategies received an estimated $5.7 billion in net flows during the three months that ended September, bringing strategy group’s total assets under management to $852.2 billion.

Total capital invested in macro strategies increased by $6.1 billion quarter-over-quarter to $599.5 billion, as performance gains offset investor outflows. Investors withdrew an estimated $4.8 billion from macro strategies in the third quarter. Equity hedge funds experienced net outflows of $7.9 billion during the last quarter, with total assets managed by the group ending the third quarter at $919.6 billion. The outflows were mainly attributable to fundamental value funds, which suffered net withdrawals of $4.4 billion in the third quarter.

“The capital raising environment continues to be challenging, with geopolitical and macroeconomic factors motivating allocations for some investors while contributing to complacency and hesitation for others. It is likely that sophisticated investors will proceed with strategic allocations in coming quarters which improve overall portfolio-expected returns through efficient, opportunistic long-short exposures,” said Heinz.

Image by rawpixel from Pixabay

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

Our newsletter is sent once a week, every Friday.

Eugeniu Guzun
Eugeniu Guzun
Eugeniu Guzun serves as a data analyst responsible for maintaining and gatekeeping the Nordic Hedge Index, and as a journalist covering the Nordic hedge fund industry for HedgeNordic. Eugeniu completed his Master’s degree at the Stockholm School of Economics in 2018. Write to Eugeniu Guzun at eugene@hedgenordic.com

Latest Articles

AllianzGI’s Impact Private Credit Strategy: Financing Change Without Compromise

Private credit has matured into an established asset class and is now evolving beyond traditional financing, offering opportunities to contribute to positive change. As...

ESG Remains Part of the “Credit Story” in Private Credit

ESG integration remains a standard component of private credit investing, particularly in Europe and among Nordic institutional allocators, but its momentum has slowed. Conversations...

From PDF to Platform: Why Governance Needs a System, Not a Folder

By Sofia Beckman – Co-founder, North House: “We manage billions with real-time systems,” one COO told me. “But our governance still lives in PDFs.”...

CABA Flex: End of Lifespan, Promises Fulfilled

About three years ago, Copenhagen-based fixed-income boutique CABA Capital was preparing to launch what would later become the first fund in its Flex series:...

Nordic Hedge Funds Maintain Momentum Towards Year-End

Nordic hedge funds are heading toward year-end with strong momentum, advancing 0.8 percent in October to extend their winning streak that began in May....

Gradually, Then Suddenly: Proxy P Extends Rebound

As Ernest Hemingway once observed, change happens “gradually, then suddenly.” For the team at renewables-focused asset manager Proxy P, a period of weak performance...

Allocator Interviews

In-Depth: High Yield

- Advertisement -

Voices

Request for Proposal

- Advertisement -
HedgeNordic
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.