Research

Asset Flows Update

Introduction

Hedge funds edged even higher in March to close at another record high, with the Eurekahedge Hedge Fund Index gaining 0.78%1, outperforming underlying markets as the MSCI World Index2fell 0.39%. Easy monetary policy in Japan and Europe continued to push regional equities into record territory, while US market volatility rose with increasing uncertainty over the Federal Reserve’s timing of interest rate hikes and the outcome of the Greek talks. Final asset flow figures for February revealed that managers reported performance-based gains of US$19.2 billion while recording net asset inflows of US$17.9 billion. Preliminary data for March shows that managers have posted performance-based gains of US$10.1 billion while recording net inflows of US$0.9 billion, bringing the current assets under management (AUM) of the global hedge fund industry to a total of US$2.19 trillion – over US$50.0 billion higher than the record US$2.14 trillion reported last year.

Figure 1: Summary monthly asset flow data since January 2011
 

Key highlights for March 2015:

  • Hedge funds returned US$54.1 billion in performance-based gains for the first quarter of 2015; their highest Q1 gains on record since 2006 which brings the total industry AUM to a record high of nearly US$2.2 trillion.
  • Asia ex-Japan investing funds have delivered the best returns globally and were up 2.08% for March, led by Greater China focused funds which gained 4.85%.
  • European hedge funds were up 4.21% in Q1 2015 and have grown their asset base by US$10.5 billion which brings their current AUM close to a record high of US$500 billion.
  • CTA/managed futures funds have reported asset inflows of US$9.7 billion for the first quarter of 2015, reversing a trend of nearly uninterrupted outflows since 2H 2013.
  • North American managers lead in terms of net investor inflows recording US$8.4 billion in new allocations, roughly half the level seen for the same period last year.

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Footnote
1 Based on 41.30% of funds which have reported March 2015 returns as at 15 April 2015
2 MSCI AC World Index (Local)
 
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