The hedge fund industry took in USD18.4 billion (0.8 per cent of assets) in August, the highest inflow in three months and a strong rebound from redemptions of USD750 million in July, according to data from TrimTabs and BarclayHedge.
“Hedge fund inflows this year are the strongest we’ve seen since the financial crisis,” says Sol Waksman, president and founder of BarclayHedge. “The industry took in USD99.0 billion in the first eight months of 2014, more than double the inflow of USD47.5 billion in the same period last year.”
Industry assets rose to a six-year high of USD2.38 trillion in August, according to estimates based on data from 3,485 funds. Assets climbed 19.5 per cent in the past 12 months and are down just 2.6 per cent from the all-time high of USD2.44 trillion in June 2008.
The monthly TrimTabs/BarclayHedge Hedge Fund Flow Report noted that the Barclay Hedge Fund Index gained 1.2 per cent in August, underperforming the S&P 500, which gained 3.8 per cent for the month. In the past 12 months, the Barclay Hedge Fund Index returned 10.3 per cent, while the S&P 500 gained 25.2 per cent.
“Sector specific funds delivered the best returns in August, gaining 2.6 per cent, while multi-strategy funds had the strongest inflows at USD4.4 billion,” says Waksman.
Investors are shunning macro funds, which have had the most redemptions year to date (USD4.3 billion) and in the past 12 months (USD9.8 billion).
The monthly TrimTabs/BarclayHedge Survey of Hedge Fund Managers finds no consensus on US stocks: 37.4 per cent of respondents in September’s survey were neutral on the S&P 500 over the next 30 days, 32.3 per cent were bullish, and 30.3 per cent were bearish. Optimism on the US Dollar Index rose to an all-time high, while pessimism on 10-year Treasury notes more than doubled. Managers also turned more bearish on gold and oil prices.