The flow of new money into hedge funds will dry up for the rest of the year as investors worry about collapses in the industry and re-evaluate their portfolios, according to London’s Integrated Asset Management, which invests in hedge funds, reports the FT on Tuesday.
Peter Rose, chief investment officer of Integrated’s funds of hedge funds, said he expected to win business from rivals but forecast a slowdown for the industry as a whole. “There is no doubt that there won’t be much investment in the next three to four months but there might be a lot of reviewing of existing investments,” he said.
Rose should know, having inherited investments in one of the Bear Stearns funds that collapsed earlier this year, and in the beleaguered Absolute Capital, which froze redemptions on several funds after the sudden resignation of its co-founder Florian Homm.
Aim-listed Integrated, which also owns an Italian brokerage, said on Monday that assets under management rose 80 per cent to $1.5bn in the year to June 30. Turnover rose 35 per cent to £7.7m and Integrated said it had a £22m war chest for acquisitions in the rapidly- consolidating business of funds of hedge funds. Mr Rose said Integrated’s investments in the AbCap and Bear Stearns hedge funds were inherited from Attica Holdings, which it took full control of this month. But, he added, the investments had been in the process of redeeming and were both small.