Global macro funds currently in high demand by institutional investors

by Amy Bensted

  • 02 Nov 2009
  • HF

Preqin monitors 480 institutional investors with an active interest in global macro hedge funds, and it currently ranks as the third most popular investment style on the Preqin database. Prior to the financial meltdown in 2008, global macro funds were relatively out of favour with institutional investors (14% of investors stated it as a strategic preference in 2007), but its outperformance of all strategies in 2008 as well as the potential it offers to produce returns from the global financial crisis has seen it grow from a niche sector in the industry to a mainstream fund choice for the hedge fund investor.

Global macro managers can expect to receive funding from a wide range of investors, with significant numbers of funds of hedge funds, public pension funds, endowments, family offices and foundations all allocating capital to macro funds. Over 40% of public pension plans have a preference for global macro vehicles, and this group invests in macro funds both via their funds of hedge funds as well as some strategic direct investments in global macro managers.

Global macro is a popular strategic choice in North America and Europe but used to a lesser extent in Asia and Rest of World (where investors are more active in distressed-style funds). The higher liquidity associated with macro funds has been an attractive feature for many hedge fund investors in North America and Europe and many investors in these regions have added macro managers to their portfolios over the course of 2009.

For more information on investors in hedge funds, please see Preqin’s Hedge Investor Profile product.

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