Introduction
The Eurekahedge Hedge Fund Index gained 0.73% in August1 while underlying markets as represented by the MSCI World Index2, were up 0.15% over the same period. Among regional mandates, Latin American managers led the table, up 3.26% during the month followed by Asia ex-Japan managers who were up 1.50%. Across strategies, CTA/managed futures hedge funds led the table with gains of 1.24% followed by macro hedge funds which were up 1.04%.
Final asset flow figures for July 2017 revealed that managers reported performance-based gains of US$16.5 billion while recording net asset inflows of US$11.6 billion. Preliminary data for August shows that managers have posted performance-based gains of US$9.7 billion while recording net inflows of US$4.1 billion, bringing the current assets under management (AUM) of the global hedge fund industry to a total of US$2.37 trillion.
Figure 1a: Summary monthly asset flow data since January 2012
Key highlights for August 2017:
- Hedge funds were up 5.12% year-to-date, registering performance-based gains of US$58.5 billion while seeing net asset inflows of US$81.9 billion as of 2017 year-to-date. Total hedge fund assets grew by US$140.45 billion over the past eight months with the industry’s total assets currently standing at US$2.37 trillion.
- In what is turning out to be the best year in terms of investor allocations since 2013, arbitrage, long/short equities and CTA/managed future strategies led in terms of net flows attracting with US$14.6 billion, US$13.7 billion and US$12.6 billion respectively as of 2017 year-to-date.
- Across regional mandates, North American and European mandates combined have attracted US$72.5 billion in investor flows this year, following redemptions of US$49.7 billion in 2016.
- Smaller funds managing assets in the range of US$100 million to US$500 million have raised almost US$26 billion this year, while the billion dollar club has accounted for US$46 billion in inflows as investor appetite for hedge funds continues to improve.
- Asian hedge fund managers outperformed their global peers in 2017 and have grown their asset base by US$13.6 billion this year, the strongest showing since 2013. On a year-to-date basis, Asia ex-Japan managers were up 14.02% with underlying Greater China and Indian managers up 19.25% and 20.92% respectively. Japan focused funds were up 6.28% over the same period.
- Hong Kong-based Asian hedge funds led the table up 13.41% among key Asian hedge fund centers whilst Singapore and Japan-based Asian hedge funds are also in positive territory, up 9.59% and 5.24% respectively for the year. More on this in the 2017 Key Trends in Asian Hedge Funds report.
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