Allocator Trends Report North America 2019

Two distinct narratives emerged about the hedge fund industry in 2018, depending on whom you ask. The first narrative was one of doom and gloom, as media headlines painted a picture of an industry in crisis. 

• Reuters: Hedge fund number to shrink, first drop since crisis
• Pensions & Investments: Tough environment has hedge fund heading for the exits
• Institutional Investors: Investors pull back from hedge funds

Despite these headlines, allocators remain committed to alternative investments. Based on a survey of nearly 450 institutional allocators in attendance at Context Summits Miami 2019, our data showed:

• 72% of investors said they felt “optimistic” or “very optimistic” about the alternative asset management industry, compared to 83% who felt the same way at Miami 2018.
• 97% said they planned to increase or maintain their net positions in alternative investments by the end of 2019; in comparison, 99% of allocators at Miami 2018 said they wanted to increase or maintain their allocations to alternative investments.
• 80% of investors said they will either decrease or maintain their cash position in 2019, indicating a willingness to put capital in the market; this compares to 77% of investors who said the same at Miami 2018.

These numbers suggest a different narrative – one of an industry in a state of evolution.

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