Research

Asset Flows Update

Introduction

The Eurekahedge Hedge Fund Index rebounded this month, up 0.27% in July 20151 , while the MSCI World Index2 was up 1.34%. Returns for Asia ex-Japan were dented this month, down 2.60% as the end of the Chinese equity market euphoria has depressed gains for hedge funds with Greater China exposure. However, European, North American and Japanese equity markets have bounced back from losses in the previous month with developed market hedge fund mandates posting good gains.

Final asset flow figures for June revealed that managers reported performance-based losses of US$29.7 billion while recording net asset inflows of US$14.8 billion. Preliminary data for July shows that managers have posted performance-based gains of US$10.9 billion while recording net inflows of US$1.7 billion, bringing the current assets under management (AUM) of the global hedge fund industry to a total of US$2.24 trillion, with asset growth totalling US$106.0 billion as at July 2015.

Figure 1: Summary monthly asset flow data since January 2012
 

Key highlights for July 2015:

  • Hedge fund assets under management have increased by US$106.0 billion in the first seven months of 2015, driven by strong investor inflows totalling US$54.1 billion and roughly US$52 billion coming from performance-based gains.
  • The CBOE Eurekahedge Relative Value Volatility Hedge Fund Index is up 5.12% year-to-date, coming in second place among all hedge fund strategic mandates. Relative value volatility funds have shown great consistency posting annualised returns of 10.33% at a low annualised standard deviation of only 3.75% since 2005.
  • Asia ex-Japan hedge funds lost 2.60% in July as funds with Greater China exposure were among the hardest hit — down 8.49% in July.
  • CTA/managed futures funds have grown their asset base by 16% in 2015 largely on the back of strong capital inflows totalling US$25.6 billion.
  • Multi- strategy funds have grown their asset base by 9.25% in 2015 to reach US$362.4 billion, with performance-driven gains accounting for over half of this gain.
  • North American managers have grown their asset base by US$63.4 billion and are up 3.01% year-to-date.

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Footnote
1 Based on 53.40% of funds which have reported July 2015 returns as at 14 August 2015
2 MSCI AC World Index (Local)
 
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