CAYMAN ISLANDS – The Cayman Islands’ hedge fund industry is still being boosted by pension fund inflows, according to a local legal firm.
Grand Cayman-based law firm Walkers said a record number of new hedge funds were created in the Cayman Islands during the first six months of the year. This was despite an overall slowdown in the inflow of capital to hedge funds.
“With a 13% increase at the end of the first six months of 2005, as compared to the record-setting second half of 2004, the Cayman Islands continue to dominate the global hedge fund industry as the venue of choice,” it said.
More than 80% of the world's hedge funds are registered with the Cayman Islands Monetary Authority. The total number of registered funds has grown to 6,527.
“With more than 795 new hedge funds established in Cayman through the end of June, Cayman's position as the leading offshore investment funds jurisdiction is well established," said Walkers partner Mark Lewis.
"We credit the growth to more global activity, increased allocation of assets to hedge funds from pension funds as well as a significant increase in the perception of large corporations and institutional investors of Cayman's position as a strong financial jurisdiction," added Lewis’ colleague Jonathan Tonge.