As investor money begins to flow back into hedge funds, new hedge funds are sprouting up to take advantage of the influx. The largest of the anticipated launches, Roc Capital Management, announced that it would open its doors in July with over $1 billion in assets. Roc Capital is just one of at least eight of the slated openings this year that are projected to raise in excess of $250 million, according to Bloomberg.
The flurry of startups is being led by a combination of executives from banks that have cut back on trading and managers at hedge funds that are being stifled by last year’s losses. A Deutsche Bank survey in March indicated that although investors as a whole were reluctant to entrust their assets with a new startup, over 30 percent of people surveyed would consider a new hedge fund if the manager had a proven track record.
According to Eurekahedge, the hedge fund industry posted its first month of net positive inflows in 10 months with $1.5 billion in May. This turnaround has likely been caused by a combination of rebounding performance and investor incentives, such as lowered management fees and provisions that make it easier to withdrawal capital. |
