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A volatility spike, sparked by inflation fears, rising interest rates and geopolitical tensions, has seen hedge fund attract the largest inflows in seven years during Q1, with investors seeking downside protection amidst market turbulence, according to a report by CNBC.
INSIGHT REPORT
Over the past two years, three trends have emerged across all-sized hedge funds regarding outsourcing. The first: outsourcing more services than before Covid-19 for cost-effectiveness; the second: an increase in use of cloud providers and data solutions; and finally: closer attention to cybersecurity risks.
The hedge fund industry turned back to outflows in February, experiencing -$3.19 billion in net redemptions, -0.07% of industry assets, according to the Barclay Fund Flow Indicator published by BarclayHedge, a division of Backstop Solutions.
Despite the trading losses and redemptions, data coming in from newly added funds led our models to show an increase in hedge fund industry assets to $5.04 trillion.
Subsectors reporting inflows in February included Multi-Strategy funds bringing in $10.11 billion; Convertible Arbitrage funds attracting $2.57 billion; Emerging Markets – Global funds adding $2.03 billion; Merger Arbitrage funds with $1.57 billion in inflows; and Sector Specific
INSIGHT REPORT
As hedge funds continue to tap into alternative datasets to help manage risk and boost performance, the need for managers to strengthen their expertise in sourcing, testing and processing information is now critical.
Mandate activity among the largest institutional investors soared in 2021 across hedge funds, private equity, private credit, real estate and infrastructure, according to research commissioned by Vidrio Financial, a provider of software and integrated data services solutions for institutional alternative allocators globally.
The second annual Alternatives Watch Research Investor Compendium tracked in 2021 a total of $130bn in new capital across more than 900 individual institutional investor mandates of 50 of the top allocators to alternatives.
The report ranks the activity of some of the largest pension plan allocators by alternative asset class and provides a snapshot of some of
Shanghai Banxia Investment Management Center, one of China’s top performing macro hedge funds, has reduced its exposure to domestic stocks to xero, according to a report by Bloomberg.
PARTNER FEATURE
The outbreak of the Covid-19 pandemic has created a breeding ground for an increase in fraudulent activity, as the world shifted to working from home and reliance on digital technology was heightened in all aspects of daily life. This underscored the need for tighter procedures and processes around detection and protection within all sectors, but especially financial services.
INSIGHT REPORT
A revolution in technology is transforming the way hedge funds operate, offering managers advantages – as well as challenges – in tumultuous times.
Institutional investors allocated the largest amount of new capital to hedge funds since 2015 in Q1 2022, as Macro funds lead industry performance through extreme volatility driven by generational inflation, interest rate increases and expectations for multiple increases in 2022, and the impact of the Russian invasion of Ukraine, including surging commodity prices driving geopolitical uncertainty and tensions to the highest level in decades.
Total global hedge fund industry capital remained above the $4 trillion milestone, as managers navigated extreme volatility with leadership from uncorrelated Macro strategies, including Fundamental Commodity and Discretionary funds, as well as Quantitative, Trend-Following CTA strategies
Preqin has published its Q1 2022 Hedge Fund Quarterly Report which shows hedge funds were affected by geopolitical factors and turmoil in the markets, posting lower returns during the quarter compared to their strong performance in 2021.
