Hedge Fund Reader : American Investors return to Mutual Funds

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August 03, 2005

American Investors return to Mutual Funds

Spectrem Group recently revealed that according to a survey conducted, more Americans worth at least $5 million doubled their mutual fund investments. The group surveyed about 500 investors during the first three months of 2005. These investors have also been found to be gradually decreasing their share in alternative investments. Investments in hedge funds for instance, have decreased from 9% to 8% of their total assets. This trend relates to the funds allocated by American investors in the past two years. Investors seem to have regained faith in mutual funds and therefore have been increasingly allocating more parts of their funds to the category. Industry observers feel that this move is in response to investors believing that the fallout from the mutual fund scandals and issues about corporate governance are over. According to the study the investors have now increased their portfolios exposure to mutual funds from 6% in 2003 to 12% in 2005. Hedgeco.net reports:

“The study surveyed about 500 investors during the first three months of 2005, and found many of the surveyed group switched back to mutual funds. According to Walper, they are worried about investment returns.”

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August 3, 2005 in Research | Permalink