Hedge Fund Exits Fall to Six Month Low in July

Date: Monday, July 22, 2013
Author: Reuters

The number of demands to pull money out of hedge funds fell in July as investors took stock after making mid-year adjustments to portfolios the previous month.

Hedge fund administrator SS&C GlobeOp's forward redemption indicator, a monthly snapshot of clients giving notice to withdraw their cash as a percentage of assets under administration, measured 2.71 percent in July, its lowest level since January. The indicator stood at 3.88 percent in June.

Bill Stone, chairman and chief executive officer at SS&C Technologies, said the result was consistent with historical averages for July, when investors, fresh from re-evaluating portfolios at the end of the second quarter, are usually happier to wait and see how investments perform.

Hedge funds have profited from a sharp rally in financial markets since last summer, but some investors are disappointed that many of them have failed to match equity markets.

So far this year, hedge funds have returned 3.16 percent, according to Hedge Fund Research, compared with a gain of more than 15 percent from the S&P 500.

Around 10 percent of the global hedge fund industry is covered by SS&C GlobeOp's data.