Fewer hedge funds closed their doors in the second quarter, but there were also fewer hedge fund launches, as investors continued to shun startups and smaller firms in favor of large, established players.

Hedge fund liquidations fell to 177 in the second quarter from 240 in the first quarter, bringing the total number of fund closures in the first half of the year to 417, according to data released by Hedge Fund Research Inc.

The industry tracker said steady returns and greater clarity around the impact of financial reform legislation helped reduce the number of fund closures.

Funds that allocate money to other hedge funds experienced 54 liquidations, the fewest since the first quarter of 2008.

Since the start of the financial crisis, over 800 funds of hedge funds have liquidated, reducing the total number from nearly 2,600 in mid-2008 to approximately 2,100.

Hedge fund launches also declined in the second quarter, with only 201 funds opening shop.

Hedge Fund Research said this was the lowest level since the second quarter of 2009. By strategy, equity hedge and macro funds were the best represented among startups.

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