HEDGE FUNDS LOSE FAVOUR WITH INVESTORS

The $3 trillion hedge-fund industry is clearly losing its appeal as it delivers progressively lower returns to investors. According to data released by Preqin, a provider of information on the alternative-asset industry, hedge funds yielded average returns of 12.22 percent in 2013, 4.65 percent in 2014 and only 2.02 percent in 2015.

The industry, which saw net inflows of $71.5 billion in 2015, has seen investors pulling out a net $34 billion in the first half of 2016. While this depletion is insignificant in comparison to the total amount invested in hedge funds, it could be the start of a trend that signals a reversal of the fortunes of the hedge-fund industry.

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