Capital crunch: New funds survey

Mon Feb 2, 2009

As funding collapses, fund launches decline 26% in 2008 - to $23.17 billion

As funding collapses, fund launches decline 26% in 2008 - to $23.17 billion

By Britt Erica Tunick

When Monty Agarwal left fixed-income specialist III Associates in early 2008 to start a fund of his own, the outlook was sunny. The hedge fund industry had seemingly rebounded from 2007's subprime credit crisis, and Agarwal had a major seed investor lined up for his new venture, an Asia-Pacific relative-value macro fund.

But just a few weeks later, by early March, everything had changed.

"Regardless of all good intentions and all good planning, you cannot foresee a year like 2008," says Agarwal. Shortly after he began putting together MA Capital Management, Bear Stearns collapsed, setting off a series of crises that continue to wreak havoc on the financial markets today. Hit by major losses related to the credit crisis, Agarwal's seed investor suddenly backed out. As the crisis picked up speed, it became...

ISSN: 2151-1845 / CDC10004H


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