Worldwide aggregate hedge fund assets reached an estimated $3.96 trillion as of June 30, according to data from HFR (formerly Hedge Fund Research).
The total represents a 4.2% increase from $3.801 trillion three months earlier, the fifth straight quarter of rising assets, according to the firm's quarterly asset flow report released Thursday.
Estimated net inflows totaled $12.3 billion for the second quarter, more than double HFR's first-quarter estimate of $6.1 billion.
The HFRI Fund Weighted Composite index returned 4% in the quarter ended June 30, trailing the first quarter's index return of 5.8%.
Three of four hedge fund categories recorded positive net inflows, led by uncorrelated macro strategies with an estimated $8.3 billion for the second quarter. Total macro assets increased $25.5 billion overall in the three months ended June 30 to end the quarter at $643.8 billion.
Relative value strategies registered $5.5 billion in net flows, event-driven strategies had $300 million in net inflows, while equity hedge strategies had net outflows of $1.8 billion.
The latter, however, led all categories in performance-based asset changes, seeing an increase of $60.5 billion. Equity hedge assets totaled $1.215 trillion in assets as of June 30.
Event-driven strategies saw a performance-based increase of $45.2 billion to end the quarter with $1.092 trillion, and relative value strategies had a performance-based increase of $23.1 billion to end the quarter with $1.009 trillion in assets.
"Leading global institutions are continuing to make and expand allocations to hedge funds as an ideal portfolio mechanism to opportunistically participate in these powerful trends while maintaining tactical flexibility and adjusting to the fluid macroeconomic environment, including the increased influence of retail trading platforms on equity market prices and volatility," said Kenneth J. Heinz, HFR's president, in a news release.