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Hedge funds lose USD850m in March

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The hedge fund industry redeemed USD850 million (0.03% of assets) in March, a turnabout from February’s inflow of USD5.4 billion (0.2% of assets), according to the latest research from BarclayHedge and TrimTabs.

“Redemptions from hedge funds totalled USD34.6 billion over the past six months, the largest consecutive quarterly outflow since June 2009,” says Sol Waksman (pictured), president and founder of BarclayHedge. “Hedge funds redeemed USD15.1 billion (0.6% of assets) in Q1 2015, a striking contrast from Q1 2014, when they hauled in USD42.6 billion (1.8% of assets).”

Hedge fund industry assets edged up to USD2.49 trillion in March from USD2.48 trillion the month before, according to BarclayHedge’s estimate based on data from 3,563 funds.

The monthly TrimTabs/BarclayHedge Hedge Fund Flow Report noted that the hedge fund industry earned 0.5% in March and outperformed the S&P 500, which fell 1.7% for the month.

“Merger Arbitrage funds rose 1.4% in March, the best returns among the thirteen categories we track,” says Waksman. “Fixed Income funds had the strongest inflows in March, taking in USD3.2 billion."

The latest TrimTabs/BarclayHedge Hedge Fund Sentiment Survey finds hedge fund managers’ optimism on US stocks sank to a seven-month low in April. The monthly survey finds declining pessimism on US Treasuries amid waning optimism on the US Dollar Index. Sentiment favouring emerging markets hit a twelve-month high, though a narrow majority still expects developed markets to outperform. Managers grew less bearish on gold prices, but most do not expect lower oil prices six months from now.

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