Increasing numbers of hedge funds are expected to shut down in 2016 , says a new report by Agecroft Partners ' , Don Steinbrugge . The report suggests hedge fund closures will be driven by : hedge funds being at an all - time high , which has reduced the quality of the industry ; increased volatility in the capital markets ; and a competitive landscape for small and medium - sized managers making it increasingly difficult as they are squeezed by the expenses and revenue side of their businesses . Research shows that performance amongst hedge funds suffered in 2015 , with the average fund falling 30 % . When he left Andor, the firm ranked as the 2nd largest hedge fund firm in the world. About 300 hedge funds closed in Q3 2015 , up from 200 in the year 2015 , says hedge Fund Research , while more are expected as year - end redemption notices from investors filter through .
Increasing numbers of hedge funds are expected to shut down in 2016 , says a new report by Agecroft Partners ' , Don Steinbrugge . The report suggests hedge fund closures will be driven by : hedge funds being at an all - time high , which has reduced the quality of the industry ; increased volatility in the capital markets ; and a competitive landscape for small and medium - sized managers making it increasingly difficult as they are squeezed by the expenses and revenue side of their businesses . Research shows that performance amongst hedge funds suffered in 2015 , with the average fund falling 30 % . About 300 hedge funds closed in Q3 2015 , up from 200 in the year 2015 , says hedge Fund Research , while more are expected as year - end redemption notices from investors filter through .