Large funds of hedge funds have risen by more than $100bn (€78bn) in the first six months of this year, despite investors cooling towards the industry last year.

Fund of hedge funds managers that each have at least $1bn of assets under management controlled $720bn of assets at the end of June, according to InvestHedge, a fund of hedge funds industry magazine. This was an increase of 16% on the total at the end of last year. The comparable increase in the first half last year was 7%. Firms boosted assets through investment performance and new capital from investors. Investors had removed money from funds of hedge funds in the final three months of 2005 following disappointing investment performance. The survey found 135 managers with at least $1bn and 20 with at least $10bn, running a combined $374bn. The largest 10 managers ran $237bn at the end of June (see list). The hedge fund industry, in which these managers invest, comprises between $1.2 trillion and $1.5 trillion. More than half the fund of hedge funds industry is European where assets grew at more than 21% in the first half, almost twice the rate of US managers. Swiss managers control more than half of Europe's fund of hedge funds assets. The number of large fund of hedge funds managers has fallen by three as a result of mergers involving GAM, New Finance and International Asset Management. Another large manager, Plusfunds, collapsed.