Growth in European hedge funds

Europe's hedge fund industry experienced strong growth in 2005, according to new figures from trade publication EuroHedge.

More than 330 new Europe-based hedge funds were launched last year, 32 per cent up from the previous year's figure of 250.

The new hedge funds raised $27.82 billion compared to $22.79 billion raised by new funds in 2004, representing a 22 per cent increase.

"The figures ... demonstrate that the rate of growth in the industry remains very strong - despite an overall slowdown in the growth of assets flowing into the industry in 2005," Reuters reported EuroHedge as saying.

"Although the average size of new funds launched in Europe declined a little in 2005 - to $83 million, from $90 million in 2004 - the year was notable for the large number of large launches."

More than $1 billion was individually raised by six new hedge funds, while 14 raised at least $500 million and around 55 hedge funds raised more than $100 million.

The most popular investment was in long/short equity, accounting for $7.27 billion of the total last year.

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