October was a strong month for inflows into the hedge fund industry, with 80% of the Absolute Return hedge fund strategies experiencing positive inflows.
Investors continue to funnel money into U.S. equity funds. The strategy, which is up 11.06% this year, took in net assets of 3.60% in October. Solid performance gains of 2.24% resulted in total assets increasing 5.84% for the strategy.
Event-driven funds may be suffering from their own success, with investors re-balancing. The strategy had net outflows of 0.77% in October despite generating an asset-weighted gain of 2.42% for the month (the strategy has produced a median unweighted performance gain of 11.26% for the year).
Four straight months of performance gains for multistrategy funds led to a 2.12% net increase in assets.
Latin American equity funds continued to suffer in October despite an asset-weighted performance gain of 5.31%, the best of any strategy, with investors pulling 4.74% of their capital; some investors have reduced their exposure to emerging markets in the second half of the year from fears that a reduction in U.S. monetary stimulus could result in currency repatriation resulting in an especially sharp decline for foreign assets.
A full chart of fund flows is provided below. This new 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 (October) and previous (September) month managed a total of $342 billion.
Change in assets
Convertible & Equity Arbitrage
Latin American Equity
Mortgage Backed Securities
*The category 'Other" refers to those funds whose strategies are not well represented enough in the database i.e. Emerging Market Debt, Emerging Market Equity and Volatility.