Hedge fund flows in June went negative for the first time in 2013 as hedge fund investors redeemed $8.6 billion, the largest outflow since October 2012 when outflows totaled $10.3 billion, BarclayHedge and TrimTabs Investment Research reported Wednesday.
June’s 1.3% loss signaled a sharp turnaround from $18.8 billion in inflows in May. The net $8.6 billion loss, or 0.4% of assets, was calculated according to estimates based on data from 3,369 funds. The hedge fund industry’s assets dipped to $1.93 trillion in June, with the 1.3% loss its worst showing since May 2012.
The loss occurred at the same time that ETF and mutual equity fund inflows hit a record in July, which is generally a contrarian bearish indicator for hedge funds.
Fixed income funds lost 1.1% in June, breaking an 18-month streak of gains stretching to December 2011, and equity long-only funds lost 1.4%, The TrimTabs/BarclayHedge Hedge Fund Flow Report noted. Funds of hedge funds shed $1.5 billion, or 0.3% of assets, in June, reversing a $428 million inflow in May. Funds of funds have attracted net inflows in just three of the past 24 months.