In its outlook for the hedge fund industry in 2012, research firm Mathema says as global macroeconomic conditions deteriorate, hedge funds might be challenged by asset outflows in the new year. Additionally, flat-to-negative performance in 2011 may carry over into 2012, potentially leading to attrition in the ranks of sub-$200 million AUM firms.

“Overall, with a short-term investment perspective we mainly remain positive on two hedge fund substrategies (fixed-income arbitrage and mortgage-backed securities/asset-backed securities arbitrage) due to distress in global financial markets and a series of technical risks affecting the hedge fund industry.”

Read the entire report below.

global-investment-outlook-report-december-2011

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