Hedge Funds Investing in Equities
Hedge Funds Increase Leverage to Invest in EquitiesHedge funds are investing more in equities in the third quarter of 2009. According to recent research, hedge funds are doing so with more borrowed capital and greater risk. Although exposure has increased it is still far below the pre-crisis level. To read the Bank of America/Merill Lynch hedge fund report follow this link.
The industry’s gross equity exposure rose 14% last quarter, and net exposure soared 130%. Average leverage, meanwhile, reached 1.2x, near their levels from the second quarter of last year.
Hedge funds are betting more on large-caps than on small- or mid-cap names, according to the quarterly hedge fund report from BofA/Merrill Lynch. The industry poured money into technology and financial companies while fleeing industrials; health-care also remains a popular destination. Source
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