NEW YORK ( TheStreet) -- For decades, hedge funds focused on serving wealthy individuals. But since the financial crisis, many individuals have fled hedge funds. Now most assets flowing into the funds are coming from pensions and other big institutions. As a result, the shape of the hedge fund business is changing. Big funds favored by institutions are prospering, while many smaller funds are struggling to survive.The exodus of individuals has been a special blow to vehicles known as funds of hedge funds. These take money from investors and put it into 20 or more hedge funds. In 2007, funds of funds had $798 billion in assets, or 42% of all money in hedge funds, according to Hedge Fund Research. Then during the next two years, investors withdrew $159 billion in assets. Today funds of funds have $672 billion in assets and account for 33% of hedge fund assets.
Hedge Funds Adapt to New Climate
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