As global hedge funds attract capital from private and retail investors, capital from institutional investors including pension funds, foundations and endowments now represents 63% of total hedge fund assets, down from 65% at the end of 2013, according to a survey conducted by investment research firm Preqin.
The survey of more than 100 hedge fund managers conducted in June revealed that 59% of hedge fund managers with backing from high-net-worth individuals reported capital inflows from these investors in the first half of 2014.
Around 47% of global hedge funds reported increased capital inflow from retail investors during the first half of 2014.
"Although the first half of the year has been rocky, with performance proving underwhelming and investor satisfaction with the industry starting to wane, it has nevertheless been a successful one for many managers," says Amy Bensted, head of hedge fund products at Preqin.
"The industry now stands at $2.9 trillion in assets under management as of 31 July 2014, up from $2.66 trillion in assets at the end of 2013," she adds.