The second half of 2013 should see increased allocations to hedge funds, according to a survey of 185 institutional investors by Credit Suisse. The poll found that 88% of these investors plan to make additional allocations to hedge funds throughout the rest of the year.
Additionally, the survey examined what institutional investors consider to be the top hedge fund strategies. Based on the percentage of those increasing allocations minus the percentage of those decreasing allocations, the top three strategies are Long/Short Equity- Fundamental (57%), Event Driven (47%) and Global Macro (39%).
Broken down by region, the survey found that investors in Asia favored Long/Short Equity- Trading (50% net demand), whereas those in the Americas and EMEA region liked the Long/Short Equity- Fundamental strategy (58% and 57% respectively).
“We believe that some of this activity is being driven by the gradual rotation of capital from fixed-income markets into equities,” said Robert Leonard, managing director and global head of capital services at Credit Suisse. “Investors are also reacting to improving global markets and lower correlations by seeking those funds that can differentiate by their stock-picking abilities. Based upon these responses, we would expect continued strong inflows to the industry during the second half of this year, as additional capital continues to come off the sidelines and into hedge funds.”
On the other hand, certain strategies are likely to see a pullback, with 32%of respondents indicating they will allocate less to Commodities funds and 29% lowering allocations to the Emerging Markets Credit strategy.
Hedge Fund Allocations Expected to Increase in Second of Half of 2013, Says Survey
The second half of 2013 should see increased allocations to hedge funds, according to a survey of 185 institutional investors by Credit Suisse. The poll found that 88% of these investors plan to make additional allocations to hedge funds throughout the rest of the year.