New York (HedgeCo.net) – Assets raised by hedge fund startups in 2009 fell 36% from the previous year, marking the second year in a row that new fund assets declined significantly, according to the biannual AR New Funds Survey, published in the February issue of AR.
The largest new fund launches in the U.S. in 2009 amassed $14.89 billion, in contrast to $23.17 billion for the largest new funds in 2008 and $31.5 billion in 2007.
Although 53 funds with at least $50 million in assets launched by year-end, compared with 55 in 2008, the average size of the funds fell significantly. The number of new funds managing more than $1 billion also decreased. Only two new funds were able to end 2009 with $1 billion or more in assets, compared with 2008, which had five funds managing that amount.
Soros Fund Management alums Joshua Berkowitz and Marcel Kasumovich boasted the biggest new fund of the year with their Woodbine Capital Fund, a global macro strategy that launched at the end of 2008 but only started taking outside capital in 2009. The fund ended the year with $2.5 billion and is already nearing $3 billion thanks to additional in-?ows at the start of 2010.
Arvind Raghunathan’s Roc Capital Partners Fund was the second-largest launch of the year—and the biggest that actually opened its doors in 2009. The firm’s global equity fund launched in August and ended the year managing $1 billion.
“There is still a reluctance of investors to part with their money. Moreover, the big issues of 2008 – transparency and liquidity – continue to be major challenges for new funds,” said Michelle Celarier, editor of AR. “The barriers to entry are also the highest they have ever been and the environment has been particularly challenging for capital raising.”
New strategies that are getting attention from investors include specialist and niche equity strategies such as those focused on health care, clean technology, climate change and alternative energy. Merger arbitrage is also attracting interest as the number of mergers and acquisitions increase.
The Top Ten Hedge Fund Launches
|
FIRM NAME |
FUND NAME |
STRATEGY |
ASSETS 12/31/09 (in $ millions) |
MANAGERS |
MONTH LAUNCHED |
||
| Woodbine Capital Advisors | Woodbine Capital Fund | Global macro | 2,500 | Joshua Berkowitz, Marcel Kasumovich | January | ||
| Roc Capital Management | Roc Capital Partners Fund | Global equity,
market neutral |
1,000 | Arvind Raghunathan | August | ||
| Pia Capital Management | Pia Macro Fund | Liquid global macro | 949 | Christopher Pia | June | ||
| LDH Energy | LDH Energy Opportunities Fund | Commodities | 750* | William Reed | September | ||
| Realm Partners LLC | Realm Partners Fund LP | Multi-strategy/
event driven |
650 | Robert Millard | July | ||
| Harbinger Capital Partners | Credit Distressed Blue Line Fund | Distressed/credit | 620 | Philip Falcone | April | ||
| Saba Capital Management | Saba Capital Master | Credit | 560 | Boaz Weinstein | August | ||
| Plural Investments | Plural Partners Master Fund | L/s equity | 550 | Matt Grossman | January | ||
| Brevan Howard Asset Management | Brevan Howard Credit Catalyst | Credit | 517 | David Warren | June | ||
| Manatuck Hill Partners | Manatuck Hill Scout Fund | L/s equity | 400 | Mark Broach | July | ||
* Estimated
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Editing by Alex Akesson
For HedgeCo.net
alex@hedgeco.net
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