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Hedge Fund Assets to Reach $5.5 Trillion by 2030
- The global hedge fund industry is projected to top $5 trillion in assets under management by 2030, driven by geopolitical volatility, multi-strategy expansion, new fund launches, and risk mitigation strategies by institutional investors.
- Hedge fund assets reached $4.1 trillion in 2024 and are expected to reach $5 trillion by 2028 and $5.5 trillion by 2030. In a best-case scenario, the sector could reach $6.3 trillion by the end of the decade.
- Major pension funds are increasingly turning to hedge funds for risk mitigation strategies after experiencing equity and fixed-income drawdowns in 2022. 36% of institutional allocators plan to commit new capital to hedge funds.
- The use of multi-manager and multi-asset strategies is growing, creating opportunities for new funds. Large multi-strategy funds deployed $20 billion in assets to third-party managers in the first half of 2024.
- Increased volatility driven by macro events such as the Trump presidency and central bank rate cuts will benefit event-driven, macro, relative value, and event-driven funds, while equity strategies may face challenges.
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