Insights from Hedge Fund Survey Indicate Geopolitical and Economic Factors may be Behind a Potentially Significant Shift in Investment and Business Strategy

Opalesque Industry Update – Insights from a survey of global hedge fund firms indicate geopolitical and economic factors may be behind a potentially significant shift in investment and business strategy. In anticipation of the 2024 U.S. presidential election, as well as the expected continuation of a high interest rate environment, hedge fund leaders who participated in the survey said their firms are planning bold moves to mitigate risk and maximize alpha potential.

Findings from the survey, published through a partnership between Dynamo Software, Dakota and ProFundCom, are contextualized in the “Dynamo Frontline Insights Report: Trends, Challenges & Insights from Leading Hedge Funds.”

Bigger fundraising, more diversification

Among the most noteworthy changes hedge funds plan to make over the next year are increased fundraising activity and diversification. A much greater number of hedge funds-as compared to the overall General Partner (GP) marketplace-expect to see bigger fundraising efforts. More than half (55%) of hedge funds surveyed by Dynamo said they expect to increase fundraising activities moving into 2025. Just 30% of the overall GP community said the same when they were surveyed by Dynamo at the outset of 2024.

As for investment allocations, nearly half (45%) of hedge fund participants said they plan to diversify across multiple asset classes over the next 12 months. In contrast, just 25% of the overall GP sector indicated their investment strategy would include diversification in 2024.

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