Investments in hedge funds will grow by 28% in 2006 due to inflows from Asia and the Mideast, according to a survey released by Goldman Sachs, the Fort Wayne Journal Gazette reports. Goldman Sachs polled 467 investor groups to complete this study.
Investors believe that global macro and equity long and short strategies will deliver the most stellar returns. Investors in Asia, ex-Japan, expect hedge fund investments to grow by 40% this year. And the Mideast and Japan have expected growth rates of 34% each.
The survey also identified new trends among hedge funds, such as longer lock-up periods with respondents' exposure to funds, which tie up their money for a year or more.
This past year, equity and long and short event-driven strategies had the biggest annual increase in allocation (41%), amounting to 13% total investments in hedge funds (13%), up from a 36% increase in allocations and 8% in total investments in 2004.
Also, the number of investors who feel that hedge fund fees will increase has actually dropped for the first time in three years, amounting to 11%, down from 24% in 2004.