Virtually No Institutional Investors Are Happy With Activist Hedge Funds Right Now | Bloomberg


The ongoing squabble between billionaire hedge fund luminaries William Ackman and Carl Icahn over Herbalife Ltd. distracts from a large warning sign for activist managers: they’re failing to live up to the expectations of institutional investors.

The August edition of research provider Prequin’s Hedge Fund Spotlight shows that 100 percent of institutional investors surveyed indicated that returns on their activist hedge fund investments had fallen short of their expectations.

Activist funds have been one of the worst-performing strategies among hedge funds from July 2015 through the midway point of this year, though funds tracked by Preqin have booked five straight months in positive territory through July 2016.

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