Hedge Funds October 2011
Hedge Funds See Redemptions, Not as Bad as Once Feared
Worries over heavy hedge-fund redemptions after poor performance may be overdone, according to data Wednesday from hedge fund service provider GlobeOp Financial Services SA (GO.LN).
GlobeOp, which runs middle- and back-office functions for about 190 hedge-fund firms and other asset managers, said redemptions and subscriptions so far this month were both around $5 billion across the $171 billion in client assets it works on, for a flat monthly flow. Third-quarter subscriptions had been $11 billion and redemptions in the three months to Sept. 30 were $9 billion.
The company said its forward-redemption data suggests outflows will be substantially lower for the rest of the fourth quarter, despite fears fund manager's asset bases could undergo another cull by investors disappointed by sharp declines at funds in August and September.
GlobeOp said just $1 billion was lost from the aggregate assets it administrates in the third quarter, plus another $1 billion decrease due to converting non-dollar denominated funds into the currency. However, September fund performance isn't included.