The Top 11 Hedge Fund Industry Trends for 2019

By Don A. Steinbrugge via

The hedge fund industry is dynamic, and participants are best served by anticipating, rather than reacting to, change.

Informed by our contact with more than two thousand institutional investors and hundreds of hedge fund organizations, the following is Agecroft’s 10th annual list of top trends that we anticipate for the year ahead.

Hedge Fund Industry Reaches Maturity

The good news for the hedge fund industry is that we have seen very few wholesale departures by hedge fund investors. However, we do expect very slow growth for the industry as it approaches a saturation point with over $3 trillion in assets under management. Total assets invested in hedge funds has reached peak levels in each of the past 9 years. Most of the growth in recent years has come from performance, with only a modest amount of new capital coming into the space. Most hedge fund investors still believe they can achieve diversification benefits from investing in hedge funds, which can also enhance the overall returns of a diversified portfolio. Although we expect industry assets to remain fairly stable, we anticipate instability at the strategy and manager level; most new assets invested in hedge fund managers are reallocations of capital redeemed from other managers.

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