The hedge fund industry redeemed USD40 million in July, the first monthly outflow of the year, after taking in USD5.1 billion (0.2 per cent of assets) in June, according to BarclayHedge and TrimTabs Investment Research.
“While hedge fund flows were essentially flat in July, inflows in the first seven months of the year totalled USD80.1 billion, the highest inflows from January through July since 2007,” says Sol Waksman, president and founder of BarclayHedge.
The industry took in USD35.0 billion in the same period in 2013.
Industry assets rose to a six-year high of USD2.33 trillion in July, according to estimates based on data from 3,468 funds. Assets climbed 18.0 per cent in the past 12 months but were down 4.5 per cent from the all-time high of USD2.4 trillion in June 2008.
The hedge fund industry lost 0.5 per cent in July. While this performance was the lowest in the past 11 months, it was better than the S&P 500’s 1.5 per cent loss. In the past 12 months, hedge funds returned 8.4 per cent, while the S&P 500 gained 16.9 per cent.
“Emerging markets funds delivered the best returns in July, rising 0.7 per cent and outperforming all other fund categories, but they also had the month’s largest outflows, redeeming USD1.9 billion,” says Waksman.
The monthly TrimTabs/BarclayHedge Survey of Hedge Fund Managers finds bullish sentiment on US stocks rose to a five-month high in August, though conviction was not strong: 38.5 per cent of managers were bullish on the S&P 500 over the next 30 days, 28.1 per cent were bearish, and 33.3 per cent were neutral.
Just over half of the managers expected equities to outperform bonds and precious metals in the next six months, the first reading above 50 per cent this year. Managers were less optimistic on gold prices and more optimistic on crude oil prices than they were in July’s survey.
