Asset flows: Money flees commodities funds; Event Driven, MBS strategies see inflows

By Rob Copeland, Amal Robleh

Tue Nov 5, 2013

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First Absolute Return fund flows report tracks investor money into and out of strategies.


It's a good time to be raising money for event-driven and mortgage-backed hedge fund strategies, according to Absolute Return's first fund flows report.

Event driven funds, which are up 9.38% this year, took in net assets of 3.64% in September. That was just above MBS managers, which collected a 3.42% net increase, despite being on track to achieve not even half of last year's median performance gain. See a complete chart with all flows below.

The data show that strong annual returns do not necessarily guarantee increased investor interest. Distressed hedge funds, the best of all the Absolute Return indices, actually saw net outflows of 0.49%. Similarly, despite solid performance gains of 5.15% in September, Latin America Equity funds still suffered total outflows of 3.77%

Performance may matter for others, such as commodities funds, subject to the steepest outflows of any strategy, totaling 4.02%, and by far the weakest Absolute Return index this year.

Overall, investors continue to allocate to hedge funds as a whole; 60% of Absolute Return hedge fund strategies had positive inflows in September.

This first data from what will be a monthly feature is based on self-reported monthly asset and performance figures from Americas-based hedge funds listing in the HedgeFund Intelligence database. Funds reporting their monthly assets in both the current (September) and previous (August) month managed a total of $367 billion.

Change in assets

Strategy

Fund Flows

Performance

Total

Commodities

-4.02%

-2.83%

-6.86%

Convertible & Equity Arbitrage

-3.03%

0.96%

-2.06%

Credit

1.58%

0.53%

2.11%

Distressed

-0.49%

1.25%

0.77%

Event Driven

3.64%

2.66%

6.29%

Fixed Income

-0.82%

0.93%

0.10%

Global Equity

1.16%

2.19%

3.35%

Latin American Equity

-3.77%

5.15%

1.38%

Macro

1.05%

1.87%

2.91%

Managed Futures

-3.77%

-0.57%

-4.34%

Mixed Arbitrage

2.74%

1.25%

4.00%

Mortgage Backed Securities

3.42%

0.39%

3.81%

Multistrategy

0.67%

1.37%

2.04%

U.S. Equity

0.58%

2.25%

2.83%

Other*

5.34%

0.91%

6.25%

Total

0.72%

1.54%

2.26%



Absolute Return data and research manager Amal Robleh calculated the figures for this report.

ISSN: 2151-1845 / CDC10004H