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UK pension giant to cut hedge funds

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'Hedge funds were hit hard as investors pulled almost $98bn (€90bn) in 2019, the most in three years.' (stock photo)

'Hedge funds were hit hard as investors pulled almost $98bn (€90bn) in 2019, the most in three years.' (stock photo)

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'Hedge funds were hit hard as investors pulled almost $98bn (€90bn) in 2019, the most in three years.' (stock photo)

The UK's largest private pension manager is slashing its investment in hedge funds, joining an exodus of investors fed up with years of mediocre returns and high fees.

The Universities Superannuation Scheme plans to halve its £1.8bn (€2.1bn) investment in hedge funds and have its in-house managers employ some of those firms' strategies, said investment chief Simon Pilcher. Disappointing returns have contributed to the decision, he said.

Hedge funds were hit hard as investors pulled almost $98bn (€90bn) in 2019, the most in three years.

The spike in redemptions came as the industry lagged behind the S&P 500 index, which returned 31pc last year with dividends reinvested.

Hedge funds on average gained 9.2pc, according to data compiled by Bloomberg. More than 4,000 have been liquidated in the past five years, according to Hedge Fund Research.

Bloomberg

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