Hedge-fund launches grow, in positive industry sign—but performance trails

The hedge-fund industry has been struggling for years amid weak performance relative to the broader market and a surge in the number of closures, but the tide may be starting to turn.

There were 189 new hedge fund launches in the first quarter of 2017, according to data from Hedge Fund Research, up from the 153 that were launched in the fourth quarter of 2016. This marked the first quarter since the first three months of 2016 where the number of launches grew, a sign that the industry could be seeing some stabilization, although the number of closing funds continued to outpace the number of new ones.

The number of liquidations dropped to 259 in the first quarter, down from 275 on a sequential basis. The greater number of closures than launches meant that the total number of active funds dipped to 9,773 in the first quarter.

 

Source: Market Watch

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