Alt Investments
Hedge Fund Outflows Decelerated Sharply In July - Data
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Figures suggest that investors were less anxious to pull out money from hedge funds in July, torn between mixed signals from markets and economics.
Outflows from the hedge fund industry slowed substantially in
July amid mixed signals on trade and the global economy,
according to the Barclay Fund Flow Indicator. Hedge fund industry
assets rose to an all-time high of $3.1 trillion in July.
Based on figures from more than 5,000 hedge funds in the BarclayHedge database,
the hedge fund industry (excluding commodity trading advisors)
gave up $1.0 billion (-0.03 per cent of assets) in July, slowing
nearly nine-fold from redemptions of $8.9 billion (-0.3 per cent
of assets) the month before. The back-to-back outflows underscore
uncertainties about trade, corporate earnings and global
commodities prices, according to the Barclay Fund Flow
Indicator.
“Corporate earnings and global equities indexes showed impressive
strength in July,” Sol Waksman, founder and president of
BarclayHedge, said. “At the same time, hedge fund investors had
to weigh July’s good news against the global implications of
trade disputes, a rising dollar and declining commodity
prices.”
Waksman noted that despite two months of redemptions, hedge fund
industry assets climbed by 5.3 per cent year-to-date and by 15.3
per cent over the trailing 12 months.
At the sector level, fixed Income hedge funds saw the heaviest
inflows in the trailing 12 months ending in July, adding $24.4
billion (5.0 per cent of assets). Equity Market Neutral funds had
the strongest 12-month inflows as a percentage of assets ($16.4
billion, 21.3 per cent of assets).
At the regional level, hedge funds domiciled in the UK and its
offshore islands fared the best in July, reeling in $4.6 billion
(0.7 per cent of assets). “U.K.-based funds have been immensely
popular in recent months,” said Waksman. These funds added $29.3
billion year-to-date and $65.7 billion in the trailing 12 months.