Ucits hedge funds see AuM growth

18 Jul, 2012

Ucits hedge funds’ Assets under Management (AuM) increased by 7.5% during the second quarter bringing total AuM to €129 billion, according to a report published by Alix Capital, a Geneva-based alternative investment specialist.

The biggest managers continue to dominate with 20 managers accounting for over half (€64.9 billion) of that €129 billion figure.  However, the report added managers with more than €100 million were growing and represented 34.3% of all single funds.

The sector has grown by 18.3% over the last 12 months and there are now 776 single manager Ucits hedge funds. According to the study, 50.3% of all single Ucits hedge funds have delivered a positive performance since the beginning of the year.

Fixed income remains the largest strategy accounting for €40.6 billion, followed by long/short equity (€40.6 billion) and macro (€18.8 billion). Commodity trading advisors (CTAs) and macro strategies had the most substantial inflows with asset growth of 26% and 17% respectively.

Alix Capital said the liquidity profile of single Ucits hedge funds remained stable with 83% offering daily liquidity, 16.4% providing weekly liquidity and just 0.6% having bi-monthly liquidity.

Luxembourg was the most popular Ucits domicile accounting for 45.7% of the business, followed by France (18.5%) and Ireland (17.4%).

Alix Capital released a survey earlier in the month highlighting the funds of Ucits hedge funds model was still valid with respondents citing better regulation of fund counterparties, legal oversight and distribution advantages as the key benefits.

According to their figures, funds of Ucits hedge funds have grown annually by 64% on average since 2008. These institutions do, however, remain small with 41% managing less than €20 million.

Funds of Ucits hedge funds are not without their critics. Many have branded them expensive while their investable universe is constrained to predominantly fixed income and long/short equity in Ucits wrappers.

Alix CapitalCTAfixed incomefunds of Ucits hedge fundsGenevahedge fundsliquiditylong/short equitymacroUCITS