Another $51.5 billion flowed into the hedge fund industry in the third quarter, representing a more than 3.5% increase and bringing the total to $1.786 trillion, according to HedgeFund.net. According HFN, which just added its 7,000th hedge fund to its coverage, the 3Q amount was smaller than the first two quarters of the year but still the third highest since beginning of 2005 as the industry maintains its 20% annual net asset growth rate. Merger/risk arbitrage and Convertible arbitrage grabbed the biggest increase in assets, 9.11% and 9.73%, respectively, bringing their totals to $27.55 billion and $47.95 billion. Only global macro saw a loss of assets in 3Q, dropping by 1.32% to $114 billion. HFN recorded these other changes in the industry in the third quarter:

  • Investors pumped another 4.34% into energy-focused hedge funds, bringing the total to $73.77 billion
  • Long/short equity HFs saw an estimated increase of 2.40% to $521 billion
  • Multi-strategy hedge fund climbed 5.23% to $181 billion
  • Distressed hedge funds added another 2.96% to $181 billion
  • Hedge funds that invest mainly in Europe soared 7.70% to more than $247 billion.