Lock-up periods for hedge funds are on the increase, and have largely been accepted as necessary way of life by investors, according to Goldman Sachs' Global Hedge Fund Investor Survey. Recently, longer lockup of two years have been viewed as a way of skirting Securities and Exchange Commission registration, but the survey suggests that "this trend has been driven by funds seeking greater stability of capital," Goldman managing director Tim Morgan, who supervised the survey, told the Financial Times. "Many find they have to lengthen their own terms in order not find themselves with a liquidity mismatch, and to secure exposure to high caliber managers." The poll found the number of funds with lockup periods of one year or more rose last year from 14% to 19%

Respondents to the survey, which represent about two-thirds of global hedge fund assets, expect a 28% increase in inflows this year, with equity long/short, global macro and event-driven strategies receiving the biggest share, and institutional investors accounting for 27% of fund of hedge funds capital, compared with 16% in 2001. They also say hedge fund investment in Asia ex-Japan is likely to soar 40%, and in the Middle East, 34%.