Wilshire: Liquid Alternatives Gain $3.1B in AUM During Second Quarter

Aug 2 2017 | 9:52pm ET

Investors continued to allocate capital to liquid alternative strategies in the second quarter, according to the Q2 2017 edition of the Wilshire Liquid Alternatives Industry Monitor, although at a far slower pace than earlier in the year. 

Wilshire, a major player in the liquid alts space and home to the Wilshire Liquid Alternative Index and its related subindexes, publishes the report quarterly to provide information on index returns, fund launches and closures, asset changes, and capital flows in the liquid alternatives industry.

AUM in the liquid alternatives universe as tracked by Wilshire increased by $3.1 billion during the second quarter, a sharp deceleration from the $17.6 billion increase seen during Q1. Assets increased during the period through a combination of organic growth, capital flows, and new entrants.

Highlights from the Q2 report:

  • 10 new liquid alternative funds were launched in the quarter, including 5 Equity Hedge funds and 5 Multi-Strategy funds. 
  • There were 21 fund liquidations - 6 Equity Hedge, 7 Global Macro, 2 Multi-Strategy, 2 Event-Driven and 4 Relative Value.
  • Of the $3.1 billion increase in AUM in Wilshire’s liquid alternatives universe during the quarter, new entrants brought in $0.1 billion, while liquidations created outflows of $0.6 billion. Net capital flows were $3.2 billion, and organic growth contributed approximately $0.5 billion. 
  • Multi-Strategy funds experienced net inflows of $1.06 billion, following five straight quarters of outflows.
  • Capital continued to leave the Global Macro space for a third consecutive quarter, experiencing $0.69 billion in net outflows.
  • AUM in Equity Hedge strategies increased by $1.3 billion.
  • Wilshire counted 511 liquid alternative funds in its universe as of June 30, 2017 managing some $309.97 billion in AUM. Market share by strategy was 28% Relative Value, 25% Equity Hedge, 16% Global Macro, 15% Multi-Strategy and 6% Event Driven. 

Founded in 1972, Wilshire Associates is an independent investment consulting and services firm that provides plan sponsors, investment managers and financial intermediaries with a wide range of services. Its business units include Wilshire Analytics, Wilshire Consulting, Wilshire Funds Management and Wilshire Private Markets, and it is home to the Wilshire 5000 Total Market Index. Based in Santa Monica, California, the firm provides services to clients in more than 20 countries representing more than 500 organizations with assets totaling approximately $8 trillion.

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