Hedge funds in aggregate experienced net outflows in the quarter ended March 31, but they were close to half the rate experienced in the last quarter of 2015, new data from eVestment showed.
Industrywide net outflows in the first three months of 2016 were $14.4 billion, 46.3% less than the $26.8 billion in net outflows the previous quarter, an eVestment analysis released Monday revealed. Net outflows and performance declines in the first quarter dropped total hedge fund industry assets 2.4% to $2.953 trillion.
Only two hedge fund strategy categories experienced positive net inflows in the first quarter — managed futures ($10.4 billion) and broad multistrategy ($3.9 billion).
eVestment researchers highlighted in their report that quarterly redemptions were higher for hedge fund strategies with bad 2015 performance.
The three hedge fund approaches with highest correlation between poor 2015 performance and the highest first quarter net withdrawals were:
- event-driven — return, -4.3%; net redemptions, $12.1 billion;
- macro — return, -3.3%; net redemptions, $8.3 billion; and
- distressed — return, -8.6%; net redemptions, $2.2 billion.
Year-to-date March 31 net outflows from all hedge fund strategies with poor 2015 returns totaled $43.4 billion, according to eVestment's analysis.
Of eVestment's four broad hedge fund categories, only commodity-oriented hedge funds had positive net growth of $3.96 billion in the first quarter. Fixed-income credit funds lost a net $10 billion; equity-related funds lost $6 billion; and multiasset funds were down $2.1 billion.