Featured statistic: EUR 2,8 billion

Date 14 April 2009

At end-2008, the capital invested in Dutch hedge funds amounted to EUR 2.8 billion, or 1,5% of total capital invested in Dutch investment funds. Hedge funds aim to realise positive absolute returns under any market circumstances. 'Absolute' in this context means: uncorrelated to market movemements. Other investment funds, by contrast, aim for relative returns, such as beating a certain index or a benchmark.

Globally, total capital invested in hedge funds ran to some EUR 1,000 billion at end-2008, according to research bureau Hedge Fund Research. Last year, negative returns on investments, investor withdrawals and banks’ tightened financing conditions caused liquidity problems for a number of hedge funds. Many hedge funds rely heavily on leverage.

Several Dutch hedge funds also faced difficulties. Still, the Dutch sector is characterised by relatively low reliance on leverage. This is partly because a considerable portion of Dutch hedge funds are 'funds of hedge funds', which do not make straight investments but rather participate in other (foreign) hedge funds.

Chart Capital invested in Dutch investment funds