Hedge Funds Say No to New Cash Just as Clients Rush to Allocate
(Bloomberg) — A new set of hedge funds is spurning fresh cash after the industry’s best year since 2009, just as more capital is poised to come into the sector.
Swiss hedge fund ADAPT Investment Managers shut its doors to new capital this month, having grown its asset base to around $2 billion, according to a person familiar with the matter. The fund gained nearly 16% in 2025, the person added. UK based stock-pickers Greenvale Capital and Boldhaven Management are also preparing to keep out new cash, other people said, all asking not to be identified discussing private information.
Greenvale, which is led by former Citadel stock-picker Bruce Emery and manages around $1.8 billion, has been mostly closed to new funds over its more than a decade-long existence, one of the people said. It expects to refuse money again later this quarter after notching an almost 21% return in 2025, with bets on residential solar and wind service providers being key drivers of last year’s gains. For Boldhaven, meanwhile, this is the first time it will be shutting out new money, other people said.
Representatives for each of the funds declined to comment.
The closure to new money comes at a time when the hedge fund industry gained $116 billion in net inflows last year, the most since 2007. For the year ahead, on a net basis, more than half of investors surveyed in Bank of America’s 2026 Hedge Fund Outlook are looking to increase their allocation, with hedge funds being the most popular asset class for the year.
“As a result of the performance – and in some cases, asset-raising – success that many firms have enjoyed in recent years, more are now closing their flagship strategies to new investment,” Goldman Sachs Group Inc. said in a report, adding that this “may pose a headwind to allocators looking to deploy more capital into hedge funds, and constrain asset growth in spite of positive sentiment.”
With clients and capital migrating to the largest industry names, many of the largest hedge funds find themselves constantly in need of experienced traders to deploy their soaring assets. Keeping out new capital was once mostly the domain of the biggest players, but even smaller managers are now having to take steps to keep growth in check in the face of rising client interest.
Hedge fund managers typically resort to restricting new money and even returning capital to avoid becoming too big, because size can be a hurdle when navigating volatile markets and certain asset classes. Macro trader Chris Rokos’ hedge fund firm last year planned to cap its assets at $20 billion and return excess cash, while Marshall Wace handed back billions of dollars to investors in January to avoid getting too big.
Marshall Wace to Return $3.1 Billion to Investors to Curb Growth
Hedge funds thrived last year as geopolitical uncertainty, President Donald Trump’s trade war and the artificial intelligence boom created fertile hunting grounds for profits. Global macro funds topped performance rankings with an average return of 27.7% in 2025, according to data compiled by Citco, while equities strategies followed close behind, gaining 23.4% on average last year.
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