Hedge Fund Liquidations Edge Lower In 1Q 2016

06/16/2016 Market Commentary

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New launches rise after sharp drop to end 2015; Average management, incentive fees mixed as macro uncertainty rises
CHICAGO, (June 16, 2016) – Hedge fund liquidations declined narrowly to begin 2016 after rising sharply to conclude 2015, as investors positioned for macroeconomic volatility in 2Q16, including Brexit and possible interest rate increases by the US Federal Reserve. The number of liquidations dropped to 291 in 1Q16, falling from 305 closures in the prior quarter but still representing a sharp year-over-year increase from the 217 liquidations in 1Q15, according to the latest HFR Market Microstructure Report, released today by HFR®, the established global leader in the indexation, analysis and research of the global hedge fund industry. New hedge fund launches totaled 206 in the first quarter, up from 183 the prior quarter, but a decline from the 264 new funds that began in 1Q 2015.