Hedge fund inflows remained strong during the first half of 2012—a net $20 billion—despite hedge fund returns that trailed those of major equity indexes.

Hedge funds received net inflows of $16.3 billion in the first quarter and $4.3 billion in the second quarter, pushing total industry assets to $2.1 trillion as of June 30, down from the record level of $2.13 trillion set on March 31, according to Hedge Fund Research’s latest industry performance and fund flows report.

Investors continued to favor the largest hedge fund managers, allocating a total of $11 billion in the second quarter to managers with more than $5 billion, while redeeming an aggregate $6.9 billion from managers with less than $5 billion in their coffers, said HFR’s report.

Source: Pi Online