Hedge Fund Market Size (AUM Value) - By Strategy (Long/Short Equity, Global Macro, Event Driven, Multi Strategy, Long/Short Credit, Managed Futures/CTA, Others), Type (Offshore, Domestic, Fund of Funds), Regional Outlook & Global Forecast, 2024 - 2032
Published Date: March - 2025 | Publisher: MIR | No of Pages: 240 | Industry: Media and IT | Format: Report available in PDF / Excel Format
View Details Buy Now 2890 Download Sample Ask for Discount Request CustomizationHedge Fund Market Size
Hedge Fund Market size (value of AUM) was USD 5 trillion in 2023 and growing at a CAGR of above 3.5% through 2024-2032. Growing Assets Under Management (AUM) of hedge funds propels the market growth as it attracts greater capital, hence more and larger funds. Greater market presence is provided by higher AUM to funds, so they can look for different types of investment schemes and opportunities. This investment contributes to the market's overall value and growth and is appealing to institutional & individual investors seeking exposure to alternative investments.
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Investor demand is a central driver fueling the hedge fund market expansion with institutional investors and affluent households looking for diversification beyond conventional investments. The trust is that it holds the promise of generating better returns and risk control measures that are capable of coping with varied market scenarios. As investors become increasingly aware of the role hedge funds play in maximizing portfolio returns and minimizing risk, the industry will continue to see increases in growth as participants range far and wide, contributing to the overall growth of the market.
| Report Attribute | Details |
|---|---|
| Base Year | 2023 |
| Hedge Fund Market Size in 2023 | USD 5 Trillion |
| Forecast Period | 2024 to 2032 |
| Forecast Period 2024 to 2032 CAGR | 3.5% |
| 2032 Value Projection | USD 7.1 Trillion |
| Historical Data for | 2018 - 2023 |
| No. of Pages | 220 |
| Tables, Charts & Figures | 227 |
| Segments covered | Strategy, Type |
| Growth Drivers |
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| Pitfalls & Challenges |
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What are the growth opportunities in this market?
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Ongoing macro and geopolitical concerns can hinder the hedge fund market growth by amplifying market volatility and increasing uncertainties. Heightened geopolitical tensions or economic instability may disrupt traditional investment strategies, challenging hedge funds to navigate unpredictable conditions. Investors may respond by adopting more conservative positions, reducing risk appetite, and potentially reallocating funds away from hedge funds, impacting their performance and asset inflows. Managing these external factors becomes crucial for hedge fund resilience and sustained growth.
COVID-19 Impact
The COVID-19 pandemic has been a boon to the hedge fund space as it fueled volatility and presented distinctive investing opportunities. Hedge funds, with their skills at arbitraging complicated market conditions, leveraged market dislocations, distressed assets, and trend reversals. The appetite for alternative investments was huge as investors yearned for diversification and risk management during periods of market uncertainty. Certain hedge funds succeeded by carefully positioning portfolios, proving to be resilient during periods of market turmoil. Moreover, the speeded-up digital revolution caused by the pandemic made it easier to incorporate advanced technologies, improving the operational efficiency in hedge fund management.
Hedge Fund Market Trends
Asset management firms diversifying into the hedge fund industry help drive the profitable expansion of the hedge fund industry. Such strategic forays involve greater capital, knowledge, and diversified investment strategies. For example, in October 2023, private equity-backed ASK Group diversified into the hedge fund industry, as part of its plan, to expand its footprint in alternative investments. The launch of ASK Hedge Solutions is intended to help investors diversify their asset base and obtain risk-adjusted returns. This injection of resources and expertise encourages market growth, providing both existing and new players with the opportunity to capitalize on the dynamic & changing hedge fund investment environment.
The rising need for advanced risk management strategies is driving the market growth. Hedge funds attract investors because they are able to weather volatile market situations and utilize sophisticated risk management techniques. With increasing complexities in financial environments, the ability of the hedge fund to contain risks proves to be an essential element for bringing in capital. The growing requirement for such refined risk management methods makes hedge funds worthwhile for investors looking for resilient strategies within a constantly changing market environment.
Hedge Fund Market Analysis
Learn more about the key segments shaping this market
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Based on strategy, the long/short equity segment accounted for 30% of the market share in 2023. The introduction of a new long-short equity strategy through a strategic partnership is driving growth in the market. This initiative strengthens the markets long/short equity segment by combining expertise and resources.
For instance, in September 2023, Investcorp-Tages, a prominent alternative investment manager, partnered with the Engadine long/short equity team (led by Engadine Partners). This strategic collaboration emphasizes Investcorp-Tages' dedication to providing innovative investment solutions for investors. As hedge funds explore collaborative strategies, the market experiences increased dynamism, offering investors opportunities for enhanced returns and risk management within the long/short equity segment.
Learn more about the key segments shaping this market
Based on type, the offshore segment held over 45% of the hedge fund market share in 2023. Tax efficiency and global access are propelling the demand for offshore hedge funds, boosting segment growth. Investors are drawn to the tax advantages offered by offshore jurisdictions, seeking to optimize their tax positions. Simultaneously, these funds provide global access, enabling investors to navigate diverse industries and capitalize on international opportunities. The combination of tax benefits and global reach enhances the appeal of offshore hedge funds, attracting those aiming to efficiently manage tax liabilities while accessing a broad spectrum of global investment possibilities.
Looking for region specific data?
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North America hedge fund market recorded more than 35% of the revenue share in 2023. Prominent fund managers and substantial hedge fund Assets Under Management (AUM) are driving the industry growth. Renowned managers attract investor confidence, while large AUM enhances market liquidity and stability. The presence of such influential players contributes to the region's position as a key global hub for hedge funds. Their expertise, track record, and ability to manage significant capital play a crucial role in sustaining market growth and attracting both institutional & individual investors to the North America market.
Hedge Fund Market Share
Major companies operating in the hedge fund industry are
- Bridgewater Associates
- Man Group
- Renaissance Technologies
- Millennium Management
- Citadel
- D.E. Shaw Group
- Two Sigma Investments/Advisers
- Davidson Kempner Capital Management
- Farallon Capital Management
- TCI Fund Management
Major companies in the hedge fund market are competing for revenue share through strategic partnerships, innovative investment solutions, and the continuous expansion of assets under management. By enhancing offerings to garner a broader investor base and solidify their market positions.
Hedge Fund Industry News
- In July 2023, The Scotia Private Client Group introduced the Scotia Long Short Equity Fund, an inaugural alternative investment within its private investment counsel. This fund empowers accredited investors to manage volatility and downside risk while capitalizing on the potential upside of equity market.
The hedge fund market research report includes in-depth coverage of the market with estimates & forecast in terms of AMU Value (USD Billion) from 2018 to 2032 for the following segments
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Market, By Strategy
- Long/Short Equity
- Global Macro
- Event Driven
- Multi Strategy
- Long/Short Credit
- Managed Futures/CTA
- Others
Market, By Type
- Offshore
- Domestic
- Fund of Funds
The above information has been provided for the following regions and countries
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Russia
- Nordics
- Asia Pacific
- China
- India
- Japan
- South Korea
- ANZ
- Southeast Asia
- Latin America
- Brazil
- Mexico
- Argentina
- MEA
- UAE
- South Africa
- Saudi Arabia
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