The latest hedge fund launch data is analysed in this extract from the Preqin Quarterly Update: Hedge Funds, Q2 2015, which looks at the structure, location, investment focus and strategy of hedge funds launched in the second quarter.
Single-manager hedge funds dominated launch activity over the quarter, accounting for 79 per cent of the 116 hedge fund launches added to Preqin’s Hedge Fund Analyst in Q2 2015 (Fig 1). Alternative mutual fund structures saw a decline in terms of their prominence in fund launches, from representing 13 per cent of fund launches in Q1 2015 to just 3 per cent in Q2 2015.
Hedge fund managers based in Europe have had an active quarter, experiencing an increase of six percentage points in the proportion of all funds launched compared with Q1 2015, when European managers represented 16 per cent of all hedge fund launches (Fig 2). Launch activity by Asia-Pacific-based managers also increased in Q2 2015, accounting for four percentage points more than the previous quarter (9 per cent versus 5 per cent).
Global-focused funds have recovered from their low level of fund launches, relative to previous quarters, in Q1 2015 to represent 59 per cent of all fund launches in the second quarter (Fig 3). The second quarter witnessed smaller proportions of funds launched with a focus on North America and emerging markets than the previous quarter, representing 17 per cent and 5 per cent of fund launches respectively.
Fig 4 shows a larger proportion of relative value strategies launches (12 per cent) in the second quarter compared to Q1 (5 per cent). This represents the highest level of relative value strategies fund launches, as a proportion of all hedge fund launches, since Q4 2010. The strategy has had a strong 18-month performance record with only two down months in the period, according to the Preqin All-Relative Value Strategies Hedge Fund benchmark. Equity and credit strategies funds have seen the largest decrease in activity in Q2 2015 (39 per cent and 9 per cent of hedge fund launches respectively), as macro and event driven strategies bounced back from a slow start to the year to represent 27 per cent and 6 per cent of fund launches in the second quarter of this year respectively.
Preqin releases quarterly reports covering private equity, hedge funds, infrastructure, real estate and private debt. All five quarterly updates can be accessed for free in our Research Center.
