Industry Was Still Dogged By Investor Redemptions In January

Date: Friday, February 13, 2009
Author: Dow Jones Newswire

Investor redemptions again dogged the hedge fund industry in January, but withdrawals slowed from the levels seen in November and December, HedgeFund.net said Thursday.

Hedge-fund performance also improved last month, the industry-tracking firm added.

A net $124.7 billion flowed out of the hedge-fund industry last month, mainly owing to redemptions and fund liquidations, HedgeFund.net estimated. Industry assets fell 5.8% to $1.748 trillion during the month.

Still, net outflows were lower than in December and November, when $133 billion and $200 billion drained out of the industry, respectively, according to HedgeFund.net estimates.

Hedge funds returned 0.2% on average in January, according to an early estimate by the firm. As more funds report results, performance could go negative, it added.

However, compared with the equity market, January is still set to be one of the industry's best months in more than a decade, HedgeFund.net said.

Long/short equity hedge-fund managers tracked by the firm lost 0.06% on average last month, while the Standard & Poor's 500 index dropped more than 8%.