Agecroft Partners Predicts Hedge Fund Industry Trends for 2012

New York ( – Based on several dominant and emerging trends Agecroft has identified through their conversations with more than 300 hedge fund organizations and 2,000 institutional investors during 2011, Agecroft Partners predicts 2012 will be the best year for net flows into the hedge fund industry since 2007 despite the lackluster investment performance for the industry in 2011.

Some of the trends they have observed include:

1. Improvement of net capital flows across most major hedge fund investor segments

2. Large rotation of assets between managers based on relative performance and changes in demand for strategies

3. Increased net flows to small and mid-sized hedge fund managers

4. Continued concentration of hedge fund flows into a small percentage of managers

5. More retail oriented hedge funds in the marketplace

6. Increase in both hedge fund closures and launches

7. Greater hedge fund investor concentration risk due to more consultant-based asset placement

“In conclusion, Agecroft Partners expects 2012 to be a very good year for raising assets in the hedge fund industry.” Don Steinbrugge, Chairman of Agecroft Partners, said, “This will we driven by a combination of positive net flow into the industry from most investor segments and large rotation of assets between managers. Although the competition from the largest well known funds will decline, the market place will remain highly competitive where a majority of assets will be going to a small percentage of managers. The managers that are successful growing their business will be those that rank well across multiple evaluation factors, have a high quality marketing message and strong distribution capabilities. The hedge fund industry is moving toward a period of sustained growth driven by institutional investors that will increasingly adopt a more institutionalized process for evaluating hedge fund managers.”

Editing by Alex Akesson
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