Hedge Funds

Citigroup research details key industry challenges


Following several decades of more modest growth, the explosion of hedge fund assets in recent years - to $1.5 trillion, according to research by Absolute Return - inevitably raises concerns about the industry's outlook.

A recently released report from Citigroup Alternative Investments addresses this issue - concluding, after some discussion, that while the industry will present challenges to investors, the prospects for talented managers to continue generating alpha will persist.

According to Rui de Figueiredo, one of the report's authors, four implications can be derived from the group's recent research. First, innovation by hedge funds will continue, creating opportunities