Fixed-income arbitrage has emerged as the fastest-growing strategy in the second quarter, according Tremont Capital Management’s Asset Flow Report for the second quarter. The strategy rose by 7.28%, following a minuscule 0.81% increase in the first quarter. In the runner-up spot is global macro, which added to its first-quarter 4.04% growth, bringing in another 7.16%. Equity market neutral, after two years of flat growth and outflows, added 5.07%, which proves, according Tremont CEO Robert Schulman, that “investors are opportunistically diversifying their portfolios. Money is flowing into hedge funds generally, while within the industry investors are adjusting their portfolios to take advantage of the changing opportunity set.” Other strategy percentages include: emerging markets (5.83%), managed futures (5.87%), long/short equity hedge (3.84%), multi-strategy (3.11%), convertible arbitrage (3.01%), event driven (2.8%) and all styles (4.19%). Overall, the HF inflows rose 4.19% in the second quarter with more than $38 billion.