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Hedge fund assets to top US$3 trillion by year end


Date: Thursday, February 20, 2014
Author: James Langton, Investment Executive

Nearly half of institutional investors increased their hedge fund allocations in 2013

Hedge fund assets are expected to top US$3 trillion by the end of 2014, according to Deutsche Bank's latest annual alternative investment survey.

The survey of asset managers, pension funds, insurance companies are other sorts of investors found that they expect hedge funds to reach a record $3 trillion in assets by year end, up from $2.6 trillion at the end of 2013, due to a predicted combination of $171 billion in net inflows and performance gains of 7.3% ($191 billion).

Nearly half of institutional investors increased their hedge fund allocations in 2013, Deutsche Bank says, and it notes that 57% plan to grow their allocations in 2014.

The survey also reports that hedge funds returned a weighted average of 9.3% in 2013, and most investors are expecting similar returns for their hedge fund portfolios in 2014.

Over 400 investor entities participated in the latest survey, representing over $1.8 trillion in hedge fund assets and over two thirds of the entire market by assets under management.