Fewer hedge funds were launched and fewer were liquidated in the quarter ended June 30 compared to the previous quarter, new data from Hedge Fund Research showed.
New hedge fund launches totaled 252 in the second quarter, compared to 264 startups in the first three months of 2015, according to HFR’s quarterly report, released Tuesday. Liquidations dropped to 200 in the three months ended June 30 from 264 shuttered funds the prior quarter.
During the first half of this year, 516 new hedge funds were launched and 417 were closed, compared to 574 startups and 461 liquidations in the first six months of 2014. HFR researchers predicted that if the pace of startups remains at its current level, 2015 will be the slowest year for new hedge fund generation since 2010, when just 935 were launched during the 12-month period, the report said.
A decline in average hedge fund management fees by three basis points to 1.51% in the second quarter for all hedge funds in HFR’s database was one bit of good news shared by HFR analysts. Average hedge fund performance fees, on the other hand, increased by an estimated five basis points to 17.78%.
Hedge funds launched in the second quarter, however, were able to command higher average management and incentive fees of 1.62% and 18%, respectively.