The hedge fund business turned around eight consecutive months of aggregate outflows in November, with investors allocating +$4.45 billion to the industry, according to the just-released November 2019 eVestment Hedge Fund Asset Flows Report. November’s asset inflows and performance gains brought overall hedge fund industry AUM to $3.285 trillion, according to the new report.
November’s inflows will ease industry fears that hedge fund outflows would match or surpass the $112 billion that was pulled from the industry in 2016, but the November 2019 year to date (YTD) outflows of $81.53 billion are not inconsequential.
Among primary hedge fund strategies, Directional Credit funds were the top asset winners in November, pulling in an additional +$2.59 billion. These funds have been on an asset losing trend however, with YTD asset flows of -$6.99 billion, which is unlikely to be turned around by whatever December brings.
Other interesting points from the new report include:
- Event Driven hedge funds are shaping up to be the big asset winners of 2019 among the primary strategies eVestment tracks, pulling in +$15 billion YTD. These funds pulled in +$1.63 billion in November alone.
- MBS Strategies also had a healthy November, pulling in $2.28 billion, bringing YTD inflows to $9.72 billion and, barring a major shift in December, should close out 2019 with big numbers.
- With November numbers in, Long/Short Equity funds look to be the big asset losers for the year. These funds saw investor redemptions of only $290 million in November, but YTD these funds have seen outflows of -$41.46 billion. Still, with AUM at $764.60 billion, Long/Short Equity funds are the largest primary strategy by far.
- After three consecutive months of inflows, Managed Futures funds shifted back to negative in November at -$2.11 billion. And although these funds had positive asset flows for the past three months, their YTD flows stand at -$8.61 billion.
- There were a small handful of elevated redemption from Emerging Markets funds in November, and no meaningful new allocations to offset. The result was a seventh consecutive month of net outflow for Emerging Markets funds.