Macro Relative Arbitrage Investors
Hedge Fund Investors Look to Macro and Relative Arbitrage
Hedge fund investors continued to place their money with hedge fund managers in the final quarter of 2011, despite a relatively volatile year for hedge funds and the markets in general. After surpassing the $2 trillion milestone in Q1, assets fell below that mark as the year progressed only to finish at $2.01 trillion. Hedge fund investors focused most of their money on macro and relative arbitrage investors, withdrawing from equity funds in Q4.
After a shaky start to the year, investors contributed more money in the fourth-quarter to their favorite hedge fund managers, according to a yearly review released today by Hedge Fund Research Inc. The report found that:
Total capital invested in the hedge fund industry regained the $2 trillion milestone.
The industry originally eclipsed $2 trillion in assets under management in the first-quarter, then peaked at $2.04 trillion at mid-year before declining to $1.97 trillion to end a volatile third-quarter.
Total hedge fund AUM finished the year at $2.01 trillion, as Q4 performance gains offset a nominal net capital outflow of $127 million.
For the full-year 2011, investors allocated $70 billion of net new capital to hedge funds.
HFR’s report termed it “a volatile performance year.”
The HFRI Fund Weighted Composite Index declined by 5% percent, only the third calendar year decline since 1990. Source
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