Hedge Fund Outlook

The 2026 Hedge Fund Outlook predicts industry assets will reach $5tn by 2027, driven by record launch activity and strong demand for macro and multi-strategy products. Emerging managers are increasingly utilizing SMAs, while established firms diversify into private credit and physical commodities.

Key Takeaways

• 1.Hedge fund industry assets are on track to reach $5 trillion by the end of 2027, one year earlier than previous forecasts.
• 2.Discretionary macro strategies are benefiting from volatility, returning an average of 11.5% through Q3 2025.
• 3.Separately Managed Accounts (SMAs) are becoming the preferred vehicle for new launches, allowing PMs to strike out with lower barriers to entry.

Table of Contents

• Executive summary
• Momentum accelerates route to $5tn
• Global macro set to prosper
• Second-tier multi-managers to gain ground
• SMA allocators fuel launch uplift
• Largest firms to cash in on private markets
• Big commodity launches on the way
• Prop trading competition grows
• Middle East enters next growth phase while APAC confidence builds
• Hong Kong sentiment rising
• Singapore remains macro destination
• Korea the new activist show in town
• Sydney's modest growth to remain muted

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