The Morning Brief: Number of New Hedge Funds Ticks Up
New launches rose and liquidations fell in the first quarter, according to data tracker HFR.
What a difference a strong stock market makes. Some 189 new hedge funds launched in the first quarter, up from 153 the previous period, according to data tracker HFR. This is the first increase since the first quarter of 2016. At the same time, the number of hedge fund liquidation declined to 259 from 275 in the fourth quarter of 2016. Altogether, there were 1025 liquidations over the past 12 months, while 712 new funds launched, for a net decline of 313 funds.
This is not necessarily a bad thing, as the industry presumably prunes its worst performers. After all, there are now still 9,733 hedge funds. Despite the reduction in the net number of funds, total capital at the end of the first quarter stood at a record $3.07 trillion, up from $3.02 trillion.
Viking Global Investors has invested $56 million in Yes To, a privately-held supplier of natural beauty products. “The Yes To board selected Viking to provide partial liquidity to existing shareholders,” the company stated in a press release.
Farallon Capital Management was one of several investors to participate in the $600 million, Series E financing of Mobike, a Chinese bike rental company. Other investors include Hillhouse Capital Management, the Beijing-based investment firm that is also the 25th large hedge fund firm in the world with $17.8 billion in assets.
Shares of hedge fund favorite Amazon.com jumped 2.4 percent to close at $23.54 after it agreed to acquire Whole Foods Market for $13.7 billion.