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Hedge funds' $5.9 billion April outflow is biggest negative flow since October 2001, says TrimTabs, BarclayHedge
By Paul A. Harris
St. Louis, June 10 - TrimTabs Investment Research and BarclayHedge reported on Tuesday that all hedge funds posted an estimated outflow of $5.9 billion in April after posting an estimated inflow of $22.0 billion in March.
The outflow in April was the first since December 2005 and the largest since October 2001.
"April's outflow from hedge funds was not surprising because hedge funds underperformed the S&P 500 in both March and April," said Sol Waksman, chief executive officer of BarclayHedge.
"Market volatility and weak inflows into funds of hedge funds suggest hedge fund flows were also depressed in May."
Breaking out the $5.9 billion outflow from hedge funds in April, hedge funds lost $9.4 billion directly, while funds of hedge funds took in $3.5 billion. Commodity trading advisers (CTAs) took in $2.2 billion, which was the largest inflow since January 2000.
"April's outflow shows that hedge funds are not immune to the impact of market sell-offs," said Conrad Gann, chief operating officer of TrimTabs.
"Yet investors pumped $5.3 billion (7.3% of assets) into CTAs in the first four months of 2008. The growing popularity of commodity-oriented ETFs and CTAs could be responsible for the steady rise in commodity prices," Gann added.
The TrimTabs/BarclayHedge database tracks hedge fund flows on a monthly basis. The TrimTabs/BarclayHedge Hedge Fund Flow Report provides detailed analysis of those flows as well as relevant topical studies. This month's study assesses the relationship between hedge fund flows and hedge funds returns. For further information, visit http://www.barclayhedge.com/products/trimtabs-hedge-fund-flow-report.html.
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