Asset flows: Investors pull from event-driven funds

By Amal Robleh

Tue Dec 3, 2013

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Managed futures funds take inflows.


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

Strategy

Fund Flows

Performance

Total

Commodities

-0.04%

-2.51%

-2.55%

Convertible & Equity Arbitrage

0.31%

0.99%

1.30%

Credit

0.17%

0.67%

0.84%

Distressed

1.02%

1.33%

2.35%

Event Driven

-0.77%

2.42%

1.65%

Fixed Income

1.47%

1.00%

2.48%

Global Equity

0.94%

2.37%

3.31%

Latin American Equity

-4.74%

5.31%

0.58%

Macro

0.63%

1.91%

2.54%

Managed Futures

1.09%

-0.43%

0.65%

Mixed Arbitrage

0.91%

1.28%

2.19%

Mortgage Backed Securities

0.74%

0.33%

1.07%
MultiStrategy 2.12% 0.77%

2.89%

U.S. Equity

3.60%

2.24%

5.84%

Other*

0.55%

1.11%

1.66%

Total

1.05%

1.54%

2.59%

*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.