Hedge fund assets increased last year, meaning they remained above $3 trillion despite $100 billion of net redemptions, according to eVestment.
Assets under management for the industry were estimated to be $3.042 trillion (€2.453 trillion) at year-end. This was a rise of $13.9 billion on the back of performance.
December marked the sixth month of outflows in the last seven months and resulted in the fourth quarter (Q4) being the largest quarterly outflow from the industry since Q1 2009, during the financial crisis.
The ‘Hedge fund industry asset flow report’ from eVestment showed that investors redeemed $23.7 billion in December and $42.3 billion in Q4.
Managed futures products produced the worst average returns of any major strategy last year, yet saw the largest inflows of over $10 billion.
Event-driven strategies saw the larger redemptions than any other strategy in 2016 and in 2015, but produced some of the industry’s best returns this year.
The report’s author, Peter Laurelli, head of research at eVestment, also said: “After a 19-month span of negative investor sentiment towards emerging market hedge funds, investors slowly started to return.”
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