June 3, 2015 / 3:56 PM / 4 years ago

Number of $1 bln-plus investors in hedge funds swells - Preqin

LONDON, June 3 (Reuters) - The world’s largest investors in hedge funds added to their holdings over the last year, in spite of the sector’s weak average performance, a study by Preqin showed.

Fifty one investors raised their hedge fund allocations to $1 billion or more over the last year, while only 27 cut their allocation, boosting the total number of such investors to 227, Preqin said on Wednesday.

Collectively, such investors had $735 billion in hedge funds or roughly a quarter of all the assets allocated to the industry, an increase of 13 percent over the previous year.

“The rise in the number of $1bn Club members over the past few years shows that the appetite for major investment in hedge funds remains strong, and appetite shows no signs of abating,” said Amy Bensted, head of hedge fund products at Preqin.

The rise in demand comes even after several high-profile investors, such as California Public Employees Retirement System (Calpers), ditched hedge funds over their performance and high costs.

The Preqin study showed three out of every 10 new investors with $1 billion or more in hedge funds were private sector pension funds.

The Eurekahedge Hedge Fund Index rose 4.4 percent last year, lagging the Standard & Poor’s 11.4 percent climb.

Full report: www.preqin.com/docs/press/$1bn-HF-Investors-15.pdf (Reporting by Nishant Kumar; editing by Simon Jessop)

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