Hedge funds lure cash

Hedge fund net inflows picked up $20.7 billion during the first quarter, bringing 12-month inflows to $99.3 billion, just under last year’s record of $106.1 billion. Event-driven hedge fund strategies, which invest in takeovers and mergers, were among the top earners, raking in $9.4 billion in inflows, according to Monday’s Lipper TASS Asset Flows Report. Meanwhile, assets under management in that sector grew at a quarterly rate of 4.01%. A record numbers of mergers and acquisitions, boosted by private equity and leveraged buyout activity, propelled inflow growth. Other successful strategies included long/short equity, which brought in $6.3 billion in inflows, and multi-strategies, which earned $3.9 billion. On the other hand, the managed futures strategy was the industry laggard. Volatility in currency and commodities dented returns, bringing them to -4.70%. During the quarter, hedge fund indices also performed well, outpacing traditional benchmarks: The Credit Suisse/Tremont Hedge Fund Index returned 3.34%, while the Standard & Poor’s 500 TR Index returned 0.64%.