Investors Still Loving Hedge Funds For Some Reason

They can't quit you!
Author:
Updated:
Original:

Please, turn this into $1.0255 billion!

As we’ve mentioned, in recent months, hedge funds have built up a small but—given their recent history—impressive lead in their annual battle against the S&P 500. Sure, the S&P picked up a whole bunch of ground in the world’s slowest race last month, adding 1.1% while hedgies rose just 0.26%, but the latter still lead by 2.55% to about 2%, so that’s something. Something enough to convince 51 new investors to boost their hedge-fund portfolios to the $1 billion level.

The number of global investors with $1 billion or more invested in hedge funds has climbed to a total of 227 over the last year, even as a number of high-profile pension funds withdrew from the space….

Insurance companies -- which made up the largest group of new entrants to the club in when surveyed the previous year -- were beaten out by private-sector pension funds this year, Preqin found. These accounted for 29 percent of the new entries to the $1 billion group between May 2014 and May 2015.

The hedge fund ‘$1 billion club’ has grown [CNBC]
HFRX Global Hedge Fund Index gains +0.26% (+2.55% YTD) [Opalesque]

Related

People Still Launching Hedge Funds Faster Than They Can Fail

Well, the numbers are finally in for 2012 and it was, relatively speaking, a bloodbath for hedge funds, with more going to their grave or down the drain than in 2010 or 2011. But there were still 235 more hedge funds at the end of the year than at its beginning, because those who have previously shuttered a hedge fund due to their failure to raise/make enough money gave it another go last year. Look for more of the same this year, as fresh-faced and not-so-fresh-faced hedge fund managers hang out a new shingle for a few months, only to find out that investors are only interested in having Ray Dalio manage their money.