Decrease in number of Dutch hedge funds

Statistical News Release
Date 25 November 2013

The number of Dutch hedge funds fell by 7 in the third quarter of 2013, to 97.

The assets managed by Dutch hedge funds decreased by 2.9% quarter-on-quarter (EUR 0.6 billion) to EUR 21.5 billion in the third quarter of 2013 (see Figure 1). This mainly reflected negative overall investment returns of 3.4% quarter-on-quarter.

Figure 1 - Dutch hedge funds

The managed assets of hedge funds established in the euro area stood at EUR 157.2 billion in the third quarter of 2013, according to ECB data. Dutch hedge funds came second in the euro area, after Ireland (EUR 99.9 billion) (see Figure 2). The managed assets of Luxembourg hedge funds amounted to EUR 19.9 billion, while hedge funds in other euro countries were relatively limited in size. According to Hedge Fund Research data, managed assets of hedge funds worldwide have reached a record level, at USD 2,510 billion (EUR 1,859 billion). Both net inflows and price gains in 2013 have contributed to an increase in managed assets. Net inflows were USD 53 billion in the first three quarters of 2013, while the HFRI Fund Weighted Composite Index rose by 5.5% in the same period. The global number of hedge funds is approximately 10,000.

Figure 2 - Hedge funds in the euro area

Dutch hedge funds are mainly funds-of-hedge funds (on the basis of the volume of their investments). In the third quarter of 2013, 77.0% of the assets of Dutch hedge funds were invested in other investment funds (mainly foreign hedge funds). 14.9% of assets were invested in equities, and 6,1% in cash deposits and other liquid assets (see Figure 3). The remaining 2% of assets were composed of investments in mainly derivatives and bonds. Dutch hedge funds have hardly any borrowings. Units issued make up 96.7% of total liabilities on the balance sheet. Borrowings make up 1.5% of total liabilities and other liabilities (including derivatives) account for 1.8%. Dutch pension funds were the largest investors in Dutch hedge funds in the third quarter of 2013, holding 92.0% of the units issued by Dutch hedge funds. The remaining units were held by the investment funds themselves (3.9%), insurers (3.6%) and Dutch households (0.5%).

Figure 3 - Composition managed assets of Dutch hedge funds