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Hedge fund failures slow as industry crisis eases

THE RATE at which hedge funds are collapsing slowed in the second quarter of 2009, in a further sign the hedge fund industry is over the worst. <br /><br />The second quarter saw 292 funds enter liquidation, a 22 per cent fall on the 276 funds liquidated in the quarter before, according to data firm Hedge Fund Research (HFR).<br /><br />But funds continue to close at an alarming rate, with 668 closing in the first half, HFRsaid.&nbsp; <br /><br />Kenneth Heinz, president of HFR, said: &ldquo;As hedge fund industry consolidation continues, multiple data points that suggest the impact of a tumultuous 2008 remain both widespread and sustained.&rdquo;<br /><br />He said performance in the sector has improved dramatically, with funds growing at their strongest levels since 1999. &ldquo;But investors are making demands for greater transparency,&rdquo; he added.