Both hedge fund launches and liquidations were down through mid-year 2015, research shows.

As financial market volatilities grew, the number of new hedge fund launches and liquidations dipped in the second quarter of 2015, according to Hedge Fund Research.

New hedge fund launches fell from 264 in the first quarter to 252 in the second, while liquidations in the industry dropped from 217 to 200. With a total of 516 funds launched over the first half of the year, HFR said the number of new launches is on pace for its lowest level since 2010.

With regards to strategy, both launches and liquidations were led by equity hedge, with 117 new equity hedge launches and 58 liquidations in the second quarter. Meanwhile, funds of hedge funds continued to undergo consolidation, with 24 liquidations and only 10 new launches during the three-month period. 

Both management and incentive fees were higher for funds launched in the quarter, with an average management fee of 1.62 per cent and an incentive fee of 18 per cent.

HFR also announced the launch of two new indices: HFRX Diversity Women Index, comprised of funds owned by women, and HFRI Women Index, comprised of funds managed by women. The former posted annualised performance gains of 2.7 per cent since 2007, during which time the latter gained 5.2 per cent.

“Since 1993, HFR has been the leader in the indexation of hedge funds, including the performance of emerging and diversity managers since 2007, and HFR is pleased to expand this important area of research to include hedge funds owned and managed by women,” said HFR's president, Kenneth Heinz. 

“HFR’s leadership in this area is in response to investor and institutional demand, as well as increased interest and a greater awareness of emerging and diversity hedge funds. These strategies offer tactical and strategic benefits to investors’ current portfolio of exposures, and comprise an important area of growth for the global hedge fund industry.”