The recent demand for event-driven and trend-following hedge funds has now lead to assets under management (AUM) in the industry setting three quarterly records in a row.
HFR said AUM in its hedge fund indices ended the first quarter at $3.07 trillion (€2.86 trillion). This followed a $47 billion increase – or 1.6% rise in value – over the three months.
This generally reflects the “positive note” that hedge funds got off to at the start of the year.
Last year hedge funds saw their largest calendar year outflows since 2009 when $70.1 billion left the industry, but HFR said the rate of outflows in the past quarter was the lowest since 2015.
There were net asset inflows to event-driven and macro strategies – but there were also outflows from equity hedge and relative value arbitrage strategies.
Kenneth J. Heinz, president of HFR, said sophisticated investors continued to strategically position for market trends that drive hedge fund performance, including “oscillating patterns of optimism and reversals of the Trump, Yellen, Brexit, and Euro trades, with each of these impacted by the increased possibility of geopolitical tensions and conflict”.
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