Investors Boosting Exposure to Hedge Funds, Competition for Talent Heats Up
Amid high demand for hedge funds among ultra wealthy investors, new research shows that the hedge fund industry recorded net inflows of $41.1 billion in the third quarter of 2007. Now, as the new year begins, executive search firm, A.E. Feldman, reports that hedge fund jobs are opening up. Funds that have managed to sidestep the credit crunch, will be raising more capital and expanding their ranks in 2008. Hedge funds are also currently suffering significant back-office staffing shortages, according to a recent survey commissioned by Rothstein Kass, the New York-based CPA firm.
Reuters reports that the hedge fund industry’s assets under management hit an estimated $1.73 trillion in the third quarter of 2007, following net inflows of $41.1 billion, according to Lipper research. Broken down by strategy, event-driven hedge funds came out on top with net inflows of $15.5 billion in the third quarter. Trailing behind were long/short equity and multi-strategies.
Despite a series of high-profile blow-ups and demands for greater transparency, the hedge fund industry is on course to beat stock market returns in 2007, the Financial Times said, citing data from Hedge Fund Research (HFR). In fact, wealthy individuals around the globe are increasingly attracted to these alternative investments. One of the main reasons behind their rising popularity: more stable returns.
Investment News reports that ultra wealthy investors are pouring money into hedge funds, according to a new survey by the Institute for Private Investors (IPI). Nearly one-third of respondents say they would put more money into hedge funds or a fund of funds in 2008. The survey also shows that hedge funds are being viewed as risk-reducing investments.
A.E. Feldman suggests that, as investors boost their exposure to hedge funds, candidates who have a comprehensive understanding of the risks and benefits of the various asset classes and investment strategies will be hot commodities.
