NEW YORK (HedgeWorld.com)–Total assets in hedge funds grew 3.3% in the third quarter to US$688 billion due to robust returns, according to Hedge Fund Research, Inc.
But at the same time net US$5.5 billion in assets left the industry. This outflow was concentrated in global macro funds, which gave back almost US$5 billion during the third quarter after receiving US$5.8 billion in the previous three months. Equity hedge and relative value arbitrage also experienced net outflows, more than US$1 billion each.
On the other hand, event-driven and merger arbitrage strategies attracted new money, probably because of signs of reviving mergers and acquisitions activity. Close to US$1 billion moved to the event-driven sector, bringing its total assets up to US$85.8 billion.
Investors also favored fund of funds, pouring US$4.4 billion into them in the third quarter. Fund of funds now control more than $225 billion in assets, or 33% of the industry total.