Is there room at the hedge fund table?

Chambers: the industry can absorb additional flows from institutions without degradation of returns

UNTIL THREE YEARS ago, high-net-worth individuals were almost the sole investors in hedge funds. Their relative sophistication, risk appetite and flexibility compared with institutional counterparts resulted in an affinity with hedge funds. Now, however, high-net-worth individuals account for less than 75% of hedge fund assets and in three years’ time their share could be below 60%.

It is not that the wealthy are removing money from hedge funds – indeed, their inflows are increasing.