Hedge Funds 2011 Opportunities
Hedge Funds Will Have Lots of Opportunities in 2011
The number of hedge funds was significantly reduced by the recession which was, of course, unfortunate for the industry and those firms who had to close shop. But a new report finds that 2011 will be full of opportunities for those hedge funds that managed to survive the recession.
In addition, says the financial services firm in its latest Global Investment Overview, other market participants (whether banks or individuals) have cut back their risk exposure, reducing competition in the sector further. Assets under management in the hedge fund space have substantially recovered, but borrowing is down dramatically. The result, according to the report, is “an attractive environment for ‘alpha’ generation.”
Other factors affecting the hedge fund space in 2011 will include the slow recovery in the credit markets; increased risk-taking by hedge fund managers; increasing dispersion of manager results; “dislocation benefits” arising from persisting macroeconomic uncertainty in some parts of the globe; and the ongoing regulation of the space (in particular, the fall-out from the current insider-trading investigation in the U.S.). Source
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