Value of Assets Managed by Hedge Funds in 2023

The hedge fund industry boomed in the 1990s, and value of assets managed by hedge funds worldwide grew steadily until 2007. The value fell markedly the following year because of the financial crisis and did not recover until 2013. In 2023, the value of assets under management (AUM) of hedge funds reached over five trillion U.S. dollars, and the largest share of the assets are managed by hedge fund managers in the United States .

What is a hedge fund?

Hedge funds are a special type of investment instrument. The main goal of hedge funds is to achieve absolute return, but unlike in case of typical investment funds, they use unconventional methods to gain above average rate of return. The management techniques used by hedge funds can be for example long/short equity, market neutral or relative value arbitrage.

Alternative data usage among hedge fund managers

The use of alternative data among hedge fund managers is becoming more popular. Traditional institution’s datasets and company filings are being replaced by data such as app data, credit card data, and geolocations. Alternative data was mainly used as a research tool to help better improve investment decisions in 2020.