Man Group's revelation yesterday that its assets under management had fallen by $6bn in its second quarter wiped 25% off its share price and sparked much talk of doom and gloom for the hedge fund industry. But this is premature and it is unlikely that hedge funds are staring down the barrel of large-scale redemptions.

The co-head of European prime brokerage at a large bank said he expects to see 5% redemptions from hedge funds by the end of 2011. Separately, Bob Leonard, global head of capital services at Credit Suisse, said: "We're not sensing wholesale redemptions across the board like there was in 2008. We're hearing of targeted redemptions from managers who suffered losses beyond their draw-down parameter or from those who have underperformed historically."