industry grows by us$30bn in may

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Hedge funds see positive inflows again
Industry grows by US$30bn in May

By Wouter Klijn
Fri 19 Jun 2009
The hedge fund industry seems to be out of the woods as it reports its first month of net inflows and good performance figures.

Global hedge funds have reported positive net inflows for the first time in ten months.

The hedge fund industry reported inflows of US$19.3 billion and outflows of US$8.0 billion over May this year, resulting in total net inflows of US$11.3 billion, according to a report by Singapore-based research firm Eurekahedge.

Hedge funds also had their best month in a year when looking at their overall performance, and as a result the industry grew their assets under management by US$19.1 billion in May.

When combining inflows and the money made from investments, the industry grew by US$30.4 billion to US$1.32 trillion over the month.

After suffering heavy losses in 2008, the hedge fund industry seems to be back on track.

The Eurekahedge Hedge Fund index, comprising 2000 funds worldwide, was up 5.4 per cent in May for its highest monthly increase since February 2000. Over 2008 the index lost 12 per cent.

Earlier this week, the hedge fund industry received good news from Hedge Fund Research Inc, which said liquidations had fallen by 50 per cent in the first quarter of 2009.

Almost 380 funds closed over the quarter, compared to about 780 in the December quarter of 2008.

"Since mid-year 2008, the total industry has declined by nearly 1200 funds to just over 9050 funds," the company said.