18 August 2006

Out With the Old…

848 hedge funds ceased to exist in 2005, though they were replaced by 2073 new ones, 500 of which were funds of funds.

There are now about 8500 hedge funds in the world.  Together they manage $1.06 trillion.  Through leverage they control about 3% of global assets, though they account for a much larger fraction of global trading.

In 2005, an additional $47 billion flowed to hedge funds.  This is much lower than 2004, when $125 billion flowed to the space following the generally good performance of hedge funds in 2003.

To June 30, 2006, an additional $66 billion has flowed to hedge funds.

Source:  Credit Suisse, JP Morgan, HFR.