Preqin Special Report: Private Debt in North America

Private Debt in North America

KEYWORDS: Prequin, pension, Institutional Investor




There are currently 227 institutional investors that have at least $1bn invested in hedge funds. This figure is an increase on the 203 investors that were identified as members of the $1bn Club of institutional hedge fund investors in a Preqin study last year. Furthermore, growth is also evident in the aggregate capital invested in hedge funds by these larger institutions, which amounts to $735bn, a 13% increase on the $650bn allocated to hedge funds as of May 2014.

Other Key “$1bn Club” Hedge Fund Investor Stats:

  • New Entrants: Private sector pension funds make up the largest proportion of new entrants over the past year, accounting for 29% of new members. Over three-quarters (77%) of new entrants are based in North America.
  • Breakdown of the Club: Public pension funds account for the largest proportion of capital invested in hedge funds by the Club (25%), despite a handful of high-profile exits from the asset class by these investors over the past year. Sovereign wealth funds follow this with 16% of the total capital invested by the Club.
  • Preferred Methods of Investing: 45% of the Club’s members solely target direct investments in hedge funds when committing to the asset class, compared to 33% of all other investors. The $1bn Club are also less likely to invest solely with funds of hedge funds, with only 8% of members investing via this route.
  • Number of Investments: The average number of hedge funds that investors in the Club have in their portfolio is 30. This compares to only 8 hedge funds for all other investors.
  • Main Strategies Being Sought: Macro funds are the preferred strategy for the $1bn Club investors, with 48% of members targeting this strategy over the next 12 months. This is followed by long/short equity being sought by 39% of investors.
  • Average Allocations: $1bn Club investors allocate 15.9% of their assets to hedge funds on average, compared to 14.3% of assets for all other investors.


Preqin Special Report: Private Debt in North America


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