Posted by & filed under Failing Managed Funds, Hedge Funds, Banks.

2019 was a tough year for Hedge Funds.

Many were shut down due to rising costs and underperformance. The few which survived were barely afloat or returning capital to investors. As a result, for the fifth straight year, there will be more closures than launches. More than 4,000 funds have been liquidated in the past five years, according to data compiled by Hedge Fund Research Inc.

This is not something that has affected new hedge funds. Legendary trader Louis Bacon announced his retreat into a family office and would return capital to investors. A combination of the longest running bull market in history, investor demanding performance or the inability to raise cash to stay in the game has caused a decline in hedge funds.

Investors have yanked $81.5 Bio this year through November, double the amount in the whole of 2018 according to eVestment data. Investors are looking to invest elsewhere due to high fees and mediocre return. As for returns, there’s little to cheer there. While the S&P 500 delivered a 28% gain this year through November, the Bloomberg Equity Hedge Fund Index only managed 10%.

Here are some of the biggest firms to shut their doors to outside investment in 2019:

  • Appaloosa Management
  • Moore Capital
  • BlueMountain’s flagship and Quant funds
  • Arrowgrass
  • Vinik Asset Management
  • Amplitude

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