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Analysts predict upturn for hedge fund industry

Date: 24 Feb 2010

Eurekahedge analysts are conservatively predicting a 12% increase in global industry AUM as the sharp change in market conditions from mid-January prompts more investors to seek greater downside protection.

Keywords (click to search): [EurekaHedge] [hedge funds] [January 2010]

Leigh Powell

Analysts for data provider Eurekahedge said today (February 24) they were expecting greater allocation to hedge funds globally in 2010 from last year.

In a report, they argue that a sharp change in market conditions in January resulted in increased risk aversion and is likely to prompt more investor interest in downside protection “which hedge funds have traditionally provided”.

They are forecasting a 12% increase in assets under management for the industry globally to US$1.68 trillion by the end of this year, from US$1.48 trillion at the end of January. However, they concede: “This might be a conservative estimate.”

They are particularly bullish on the industry’s prospects in Asia, where AUM stood at US$117.4 billion at the end of last year.

They expect the inflows to pick up gradually to bring the size of the region’s industry to US$140 billion...

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