Hedge Funds to Draw $80 Billion in 2012, Most in Five Years, Barclays Says - Bloomberg

Hedge Funds to Draw $80 Billion in 2012, Most in Five Years, Barclays Says

By Bei Hu – Jan 15, 2012 8:47 PM MT

Investors may add about $80 billion of new capital to hedge funds globally this year, the most since 2007, Barclays Plc (BARC) said in a report.

About 56 percent of investors surveyed by Barclays plan to increase such investments in the coming year, more than seven times the number that plan to reduce their allocations, the U.K. bank said in an e-mailed statement dated Jan. 13. Endowments, foundations, private banks and public pensions will most likely be the sources of new capital to the industry, it said.

This year “has the potential to be the most significant year for new capital allocations to hedge funds since 2007,” Ajay Nagpal, Barclay’s head of prime services, said in the statement.

Barclays is projecting an increase in inflows after the hedge fund industry globally posted the second-worst annual performance on record in 2011. Eurekahedge Hedge Fund Index (EHFI251) declined 4 percent last year, according to preliminary data.

via Hedge Funds to Draw $80 Billion in 2012, Most in Five Years, Barclays Says – Bloomberg.