LatAm Hedge Fund Assets Balloon
Jul-01-2008 | Source: LatinFinance.com

Total estimated assets in hedge funds focusing on LatAm rose sharply
in Q1 2008 and have increased significantly since the end of 2006,
according to HedgeFund.Net. "At the end of Q1 2008 total assets in
LatAm focused funds reached an estimated $21.28 billion. This was an
increase of $4.9 billion in the quarter and was mainly in the form of
new allocations to the region," says HFN.


This represented an almost 30% rise in assets during the quarter, the
fund tracker adds. Since HFN started covering LatAm in February 2007,
its benchmark average index has increased 28.02%, outperforming every
strategy-specific HFN benchmark except the HFN Mortgages Average and
most regional or country specific benchmarks.


Only the HFN Brazil, Middle East/North Africa and China averages have
outperformed the broad LatAm hedge fund index, says HFN. The majority
of funds focusing on LatAm manage fewer than $500 million in assets
and smaller fund size has not necessarily translated to better
performance.


"In the last 12 months, the smallest funds, those with less than $20
million in AUM, have produced the lowest returns at each percentile
point outside of the top 10th percentile," says HFN. LatAm hedge
funds returned 4.07% in May, much more than the 1.88% global average.
They have made 4.63% in the year to date, versus 0.67% for funds on
average globally.