London, 12 April 2012 - Assets in global
hedge funds edged up slightly during 2011, despite the strong
headwinds in global markets and the negative performance
delivered on average from funds in the industry last year,
according to the latest research from HedgeFund Intelligence.
Assets in hedge funds of traditional types, which are mostly
domiciled offshore or structured as limited partnerships in
the US, reached $2.059 trillion (including parallel onshore
versions) at the end of 2011, according to the latest
research. That was a slight increase from $2.022 trillion at
the end of 2010, though down a little from $2.158 trillion at
the mid-point of 2011.
If other hedge funds and absolute return funds in standalone
European UCITS onshore structures (with no parallel offshore
versions) are added, the latest total rises to $2.156
trillion – up from $2.099 trillion a year before,
but also down from mid-2011 when assets including UCITS had
reached $2.256 trillion.
These asset numbers indicate that the industry was continuing
to receive positive net inflows from investors despite the
negative impact on aggregate assets caused by performance
The median performance of hedge funds globally was -2.01% in
2011, according the HedgeFund Intelligence Composite
– but, as in the last negative year of 2008, the
median again obscured a significant negative skew in the
distribution of returns, with the mean average of the
Composite weighing in quite a lot worse at -4.44%. For
overall assets to be slightly up again after such a difficult
year provides powerful testimony of the continuing faith of
investors in hedge funds to deliver strong risk-adjusted
returns over the cycle – at least thus far.
The latest figures are encouraging, but still leave the
industry a long way from the peak level of assets which
briefly spiked to $2.65 trillion in 2007 during the period
just before the global financial crisis. After a dramatic
fall during 2008 to just over $1.83 trillion, assets have
been edging up slightly every year since.
The big keep getting bigger
Meanwhile, the biggest players in the global hedge fund
industry are continuing to get bigger, accounting for a
rising proportion of total assets, according to the latest
statistics on the Global Billion Dollar Club – the
elite group of firms that manage $1 billion or more in hedge
Collectively, the 340 current members of the Global Billion
Dollar Club now manage assets of just over $1.76 trillion, up
again from around $1.7 trillion a year before, and now
representing over 86% of the industry’s total
assets – up from 84% last year and 82% the year
The lion’s share of this increase is also
concentrated in the 'super-league’ of biggest
firms that manage $5 billion or more. The number of firms in
that category has edged up from 93 to 99 in the past year,
and collectively they account for nearly $1.23 trillion
– up from $1.15 trillion a year before, now getting
close to 60% of the industry’s total assets.
The US market remains very much the top location for the
world’s biggest hedge fund firms. There are
currently 230 firms that manage hedge fund assets of $1
billion or more from the US. And New York is still the
biggest single centre of the industry, being home to no fewer
than 139 of those firms, up from 128 a year before –
though the proportion of assets they account for slipped from
44.96% to 42.61%.
London remains in second place overall, and though its number
of Club members is down from 63 to 57, the share of assets of
those firms is slightly up, at 14.55% from 14.49%.
While firms based in Asia remain a relatively small portion
of assets in the industry overall, the number of local firms
in the region reaching the Billion Dollar Club continue to
rise steadily. The number in Hong Kong was up from 11 to 13
during the year and the number in Singapore was up from seven
The total number of firms on the list now comes to 340
– a figure that de-duplicates for a number of big
groups such as BlackRock, Och-Ziff and Brevan Howard that run
$1 billion-plus funds from related companies in more than one
location. This is up a little from last year, when there were
330 firms on the list.
The figures shown here are for single-manager hedge funds
only. They do not include or double-count money allocated to
hedge funds via funds of funds. Assets in funds of hedge
funds are tracked separately by InvestHedge.
About HedgeFund Intelligence:
HedgeFund Intelligence is the leading provider of news,
analysis and performance data on the global hedge fund
industry. The company provides dedicated information on US,
European, Asian and African single-manager hedge funds as
well as on hedge fund investors worldwide.
For more information, please contact:
Del Jones / Toby Bates, Merlin PR