West Palm Beach, FL (www.hedgeco.net) – A new released survey by the Russell Investment Group shows that the global hedge fund industry will continue to attract more investor assets in the coming years. The new survey concluded that while hedge funds would continue to pull in more assets, their returns may lag according to the released data. Tom Hanly, chief investment officer for the Russell Investment Group told Reuters that “The year’s survey paints a clear picture — alternative investing will continue to grow at a strong pace worldwide, hedge funds will continue to garner the greatest share of increased commitments, and the smaller markets will increase their alternative investments significantly compared with the more mature markets.”

Details of the Russell survey also shows that returns will likely be strongest at private equity funds. The study which surveyed 327 organizations and institutions in North America, Europe, Australia and Japan reveals that such group is forecasting returns in the range of 10 percent.  North American institutions however see a slightly lower than 10 percent return from hedge fund managed portfolios.

For the first 8 months of 2005, the average hedge fund returned about 4.6 percent amidst a range of problems including the credit problems of auto makers. The new study also showed that “European tax-exempt institutions currently allocate 4.5 percent of their investment portfolios to private equity and are planning to increase to 6.1 percent in 2007.” The survey also projected those hedge fund allocations in Japan will likely increase from the level of 2.4 percent seen in 2005, to 4.5 percent in 2007.

Paul Oranika
HedgeCo.Net
Email: Editor@hedgeco.net

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