Order maintained in four sectors with a number of interesting trends to note. The latest update in the AlphaPipe/HFMWeek Service Provider Snapshot has seen order maintained at the summit of the provider tables in the second quarter, with administrator SS&C GlobeOp extending its lead in both the number of funds serviced and regulatory assets under management ( RAuM). Despite a tough start to the year, hedge funds managed to rectify negative performance in the second quarter, making returns of 1.8% over three months, according to the HFRI Fund Weighted Composite index, taking YTD re- turns to 1.2% at the end of June.
Large moves in prime brokerage and custody services see provider tables changing in the first quarter while recent studies have shown little movement in most of the categories, 2016’s first quarter installment of the HFMWeek/AlphaPipe Service Provider Snapshot has shown a relatively large amount of change. The three-month period was a tough one for hedge funds as the HFRX Global Hedge Fund Index fell -1.9%, marking its worst start to a year since the beginning of 2008.
There was little change in the latest service provider tables during another quarter of negative hedge fund performance--
The final three months of 2015 saw little movement in the service provider stakes with most firms retaining their third quarter positions, according to the latest HFMWeek/AlphaPipe Service Provider Snapshot. Despite a decent start to the quarter, which saw hedge funds enjoy respective gains of 1.7% and 0.2% during October and November, in December they recorded a -1% fall according to HFR data, mirroring the HFRI Fund Weighted Composite index’s annual result of -1%.
SS&C and Mitsubishi MUFG acquisitions change the shape of admin table as growth elsewhere remains flat--
With many strategies hit by the market volatility during the quarter, service providers remained mostly at in growth and market share, according to the latest HFMWeek/AlphaPipe Service Provider Snapshot. While outperforming major market indices, hedge funds made an overall loss of -1.22% in September, according to HFR data. It completes a fourth consecutive month of losses, the worst run since the 2008 nancial crisis. In the administration space there is a third new leader in as many quarters as SS&C GlobeOp’s purchase of Citi’s admin book boosted assets by 20% to overtake last month’s table-topper Citco.
Good inflows into hedge funds in the second quarter serve as boost to larger service providers--
Strong inflows into hedge funds in the second quarter have been reflected in the performance of many of the largest service providers and administrators in particular, according to the latest HFMWeek/AlphaPipe Service Provider Snapshot.
Hedge funds enjoyed strong allocations in the second quarter of 2015 as investors added $21.5bn of net new capital, according to Hedge Fund Research. This represented the largest quarterly inflow into hedge funds since Q2 2014 and brought total global industry capital to $3trn. Inflows in the first half of 2015 amounted to $39.7bn.
HFMWeek’s study shows little change in top 20 auditors, custodians and prime brokers with one new admin entrant-
The final quarter of 2014 represented a potentially difficult period for hedge funds as oil price decline, geo-political unrest in Eastern Europe and a general fall in stock markets continued to take their toll.
According to the latest Hedge Fund Research data, total assets increased 1.1% in the fourth quarter to stand at $2.85trn, a $30bn increase from the end of September and up $220bn since the start of 2014.