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Hedge Fund Industry Could Be Worth $4 Trillion by 2010

by Carla Johnson, Investors Offshore

07 June 2004

According to a report in the alternative investment press, hedge fund group Platinum Capital Management has estimated that the total amount invested in hedge funds will reach $4 trillion by the year 2010.

Platinum believes that recent forecasts for future hedge fund growth over the next six years have been significantly underplayed and that the alternative investment sector is on the brink of a massive boom akin to that experienced by the mutual fund industry in the 1970s and 1980s, industry magazine Alternative Fund Services Review reports.

Assets under management in the mutual fund industry grew by a compounded 30% per year between 1978 and 1998, from $15 billion to $3 trillion.

A similar rate of growth in the hedge fund sector would result in total assets under management in the region of $4.6 trillion by 2010 says Platinum.

The current size of the hedge fund industry is estimated at between $800 billion and $1.1 trillion.

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