Fresh data reflects hedge funds’ struggle

Decline2More data this week shows how hedge funds have struggled to maintain their total assets under management (AUM) at a time when they are seeing their worst performance for two years.

Asset levels dropped in June as new investor contributions proved insufficient to counter the impact of poor performance, according to data firm eVestment.

Earlier this month, hedge fund information provider, HFR, reported the worst monthly performance for hedge fund in two years.

The eVestment data shows investors added $12.1 billion (€11.0 billion) to hedge funds in the month, but assets still dropped by 1.57% as a result of performance losses.

The firm says losses were concentrated to macro and managed futures in the second quarter (Q2) of 2015.

The June downturn reduced the industry’s total AUM to $3.12 trillion, a loss of $61.9 billion, according to the eVestment June 2015 Hedge Fund Asset Flows Report.

Overall investor inflows to hedge funds reached $75 billion for the first half (H1) of 2015, a reduction on the H1 2014 inflows of $97.4 billion.

However, equity-focused hedge funds still proved popular in June. The summer month brought inflows of $4.6 billion to this type of strategy, boosting Q2 inflows to $17.3 billion.

Multi-strategy funds, which have had only one month of investor outflows in the last two years, continued their positive streak in June, as did managed futures and emerging market-focused funds which both saw positive flows.

Exposure to Europe continued to be a popular theme among investors, with funds focused on European markets drawing the largest inflows of any specific regional focus in June and across Q2. Growth among firms domiciled in Asia has also been strong in 2015.

Weaker areas included event-driven funds, which saw outflows of $1.2 billion in June. eVestment suggests that after taking raising nearly $43 billion in 2014, event-driven has now become saturated.

©2015 funds europe