Hedge funds saw net asset flows of $6.9bn (€7.8bn) for the third quarter of 2001, down by $1.5bn from the previous record-making quarterly inflow of $8.4bn, the latest report by Tass Research said.

So far this year, hedge funds have seen a net inflow of $22.3bn, compared with $8bn for the whole of 2000. In the third quarter, 64% of the net flows came from event-driven and convertible arbitrage strategies.