The global hedge fund industry experienced its eighth consecutive quarter of growth in Q3 2025, with total capital reaching an all-time high of $4.98 trillion. This growth was primarily driven by a massive $33.7 billion net inflow of new investor capital, marking the largest quarterly inflow since Q3 2007, according to the HFR Global Hedge Fund Industry Report.

Performance was led by Equity Hedge strategies, with the HFRI Equity Hedge Index gaining 7.2% in the quarter. Other strong performers included Event-Driven funds and Relative Value Arbitrage. Macro strategies also rebounded, with assets rising by $33.5 billion. Significantly, the HFR Cryptocurrency Index also posted a strong rebound of 20.3%.

Inflows were heavily concentrated among the largest managers, with firms managing over $5 billion in assets under management capturing $32.2 billion of the new capital. HFR attributes this accelerated growth to factors such as increased M&A activity, lower geopolitical risk, renewed interest in cryptocurrencies, and investments in Artificial Intelligence (AI). The industry is now expected to surpass the $5 trillion milestone by year-end.

According to a Reuters report citing HFR, there are around 8,464 hedge funds globally that have taken in roughly US$71 billion in inflows this year, the highest since 2014.

End Notes

Source: https://www.hedgeweek.com/global-hedge-fund-capital-nears-5tn-after-record-q3-inflows/

Source: https://www.reuters.com/sustainability/boards-policy-regulation/hedge-funds-now-manage-record-almost-5-trillion-says-hfr-2025-10-23/#:~:text=Total%20global%20hedge%20fund%20industry,high%20earlier%20this%20year%2C%20Reuters%20