Hedge Funds Remain 'Remarkably Popular' With Investors

by Phillip Morton, Investors Offshore.com

15 August 2006

Tremont Capital Management's Asset Flow Report for the second quarter of 2006 has shown a $38.3 billion net inflow across all investment styles for the second quarter of 2006.

According to the report, Emerging Markets strategies, the largest gainer in the first quarter, continued to attract investment assets growing at a rate of 5.83%, after a 7.97% increase in the first quarter.

Fixed Income Arbitrage increased at the fastest rate, growing by 7.28%. This strategy had seen only a modest increase of 0.81% in the prior quarter. Global Macro saw the next largest increase with inflows of 7.16% versus 4.04% in the first quarter.

Overall hedge fund assets increased in excess of $38 billion in net inflows to a total of $954 billion, positive net inflows seen across all hedge fund strategies measured.

The report suggests that the hedge fund industry is continuing to attract assets at a remarkable rate.

"Investors are opportunistically diversifying their portfolios," stated Robert I. Schulman, Chief Executive Officer of Tremont Capital Management Inc.

"Money is flowing into hedge funds generally, while within the industry investors are adjusting their portfolios to take advantage of the changing opportunity set," he added.

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