Hedge Funds Redemptions 2011

Hedge Funds Redemptions

Hedge Fund Industry Fears New Wave of Redemptions

Investors have been unsettled after more than a month of shaky markets and poor performance by many hedge funds.  Now, the hedge fund industry is largely bracing for a big wave of redemptions.  Man Group (EMG) has contributed to this fear after it announced investors pulled a whopping net $2.6 billion from its funds from June 30 to August 26.
The world's largest listed hedge-fund manager, Man Group PLC , stoked fears of another industry meltdown Wednesday when it reported a net $2.6 billion was pulled from its funds between June 30 and Sept. 26. It lost a further $1.5 billion from fund losses and $1.9 billion from the effect of a stronger U.S. dollar when accounting for euro- and Australian dollar-denominated funds. Its GLG unit, acquired last year, posted particularly large outflows.
Man Group shares fell as much as 25% in London. 
Aberdeen Asset Management PLC (ADN.LN), a U.K. fund manager with about GBP26.2 billion of its GBP176.9 billion in alternative investment strategies, Monday said those funds lost about GBP2.2 billion between June and August from redemptions and performance losses.
Despite volatile markets this year, redemptions have been relatively subdued for most hedge funds, but high-profile losses over the summer and the deepening euro-zone debt crisis and economic gloom could send investors toward the exits. Most large managers of long-only equity and bond funds posted outflows last week, data provider EPFR Global said Monday, highlighting how investors are taking risk off the table. Source

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