Investor Sentiment for Alternatives Remains Positive...
Preqin's 'Investor Outlook for Alternative Assets in H2 2015' reinforced the hedge fund industry's continued growth in the first half of 2015. Hedge fund industry assets increased to $3.2 trillion for the six months ended June 30th and total net inflows totaled $76 billion during the same period. The majority of inflows went to the largest and most established hedge funds while managers with less than one-billion dollars in assets continued to refine their process to raise more capital from the pensions, endowments and foundations.
Preqin’s findings were based on a survey of 460 institutional investors in alternative assets, 43% of which were located in North America, 31% in Europe, 22% in Asia and 4% in the rest of the world. The analysis included:
- 79% of institutional investors worldwide invest in at least one alternative asset class;
- Investors showed greater levels of satisfaction with hedge fund performance over the first half of 2015 as compared to the 12-month period to June 2015;
- In H1 2015, hedge funds made gains of 5.65% compared with the 3.37% logged by the S&P 500;
- 96% of the investors in the Preqin study have a current investment in an equities strategy; 80% have been satisfied with the performance of the strategy over the first half of 2015;
- 90% investors with an investment in a multi-strategy fund ranked the strategy as performing well in the first half of 2015; multi-strategy funds enjoyed a seven-month streak of positive monthly returns between November 2014 and May 2015;
- Activist funds were rated as good performers by investors; they delivered the highest year-to-date net return (7.60% as of 30 June 2015) of all the hedge fund strategies; and
- In contrast, 80% and 73% of investors in systematic and discretionary CTA strategies respectively feel that these funds had not performed well in the first half of 2015.