Hedge fund assets will grow 75% in the next five years, according to research from TowerGroup in Needham, Mass.
The research company predicted Monday that hedge funds would grow at a compound annual rate of 15%.
Hedge funds have moved increasingly into the spotlight as a broader spectrum of investors seeks alternative products capable of beating average market returns. TowerGroup said hedge funds would become more mainstream in the next few years as institutions increase their allocations to alternative investments, funds of hedge funds proliferate, and new retail investment products lower the barriers to hedge fund entry.
TowerGroup said it has concluded that this changing client base in the hedge fund market, along with significant growth expectations, will drive opportunities and challenges for service providers in the industry.
