Overview of 2010 Key Trends in UCITS III Hedge Funds
The phenomenal growth in UCITS III hedge funds
over the last few years has been one of the mostinteresting developments in the global alternative investment sector. Currently, the Eurekahedge UCITSIII Hedge Fund Database lists 775
UCITS III products, with another 500 to be added in the comingmonths. Furthermore, the Eurekahedge UCITS Hedge Fund Index, the industry benchmark and mostwidely used tracker in the sector, consolidates the monthly performance of 236 funds.Utilising data from the Eurekahedge UCITS Hedge Fund Database, this report picks up from ourintroductory piece in March 2010 and analyses the key trends emerging from the UCITS III hedge fundsector over the last few years. For a more detailed introduction on the unique features of UCITS IIIregulations and fund structure, please refer to our previous report
.Figure 1 shows the growth in UCITS III hedge funds in the last three years.
Figure 1: Industry Growth over the Years
The size of the global UCITS III hedge fund industry currently stands at US$131 billion, managed by 615unique
(flagship) funds. Given the rapidly changing dynamics of the industry, we predict this number tocontinue growing at a rapid pace. An important point to note here is that most of the growth in theUCITS III industry comes not from new boutique fund start-ups but from the following three segments:
UCITS III funds launched by existing hedge fund management companies. In the post-financialcrisis environment where issues of regulations, transparency and liquidity have taken centrestage, existing hedge fund managers have identified the UCITS structure as a key to raisingassets. Additionally«
In this report, we include funds employing absolute return strategies with a hedge fund-like structure.
As of August 2010.
March 2010 Eurekahedge Key Trends in UCITS III Hedge Funds
As opposed to multiple share classes, currency denominations and suchlike.