Over 450 hedge funds closed down in 2006 |
Date: Thursday, February 1, 2007
Author: Reuters.com
Reuters - Over 450 hedge funds went out of business in 2006, capping a year during which Amaranth Advisors LLC liquidated after bad bets on natural gas cost the firm $6.6 billion, the biggest single loss ever at a hedge fund.
Hedge fund industry consultants the Hennessee Group reported on Wednesday that the roughly $1.3 trillion hedge fund industry lost 5.1 percent of its managers last year.
That is down from the 5.4 percent attrition rate in 2005 and the 6.2 percent rate in 2004, the New York-based group said.
"Each year the attrition rate has declined and we would expect that trend to continue in the coming years as it becomes ever more difficult to enter the hedge fund industry and be successful," Hennessee Group analyst Brian Snider said.
The attrition rate spiked in 2003 when 5.4 percent were swept out after only 3.8 percent closed down in 2002.
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