Hedge fund assets increased by a net $149 billion in the fourth quarter, bringing total industry assets to $1.917 trillion, just shy of the all-time industry high of $1.93 trillion at the end of the second quarter 2008, according to data released Wednesday by Hedge Fund Research.
The growth in the fourth quarter was a record; the previous quarterly high mark was a net $140 billion in the second quarter of 2007.
Fourth-quarter growth came from a combination of performance and $13.1 billion of net inflows, according to HFR's monthly hedge fund performance trend report for the period ended Dec. 31.
The HFRI Fund Weighted Composite index returned 5.58% in the fourth quarter and 10.49% in 2010.
Net fourth-quarter inflows significantly trailed the $19 billion of net new assets invested in hedge funds in the prior quarter. Full-year net inflows into hedge funds totaled $55.5 billion, the highest yearly influx since 2007, when inflows were $195 billion. The hedge fund industry experienced net outflows of $154 billion in 2008 and $131 billion in 2009, according to HFR analysis.