(Bloomberg) -- Nektar Asset Management is shutting down its money pool after its largest backer pulled out, adding to a growing list of hedge funds that have thrown in the towel.
Brummer & Partners, an investor since 2002, said it will cash out by the end of May because the Nektar Fund’s expected future return is no longer competitive.
Patrik Olsson, chief investment officer at Stockholm-based Nektar, said in a statement on Thursday that the decision to close the fund was the result of a “prolonged challenging market environment.” The Nektar Fund managed about 10 billion Swedish kronor ($1 billion) as of March 31.
The closure underscores the continued pressure on the $3 trillion hedge-fund industry as investors bail out following years of high fees and mediocre returns. Closures have outnumbered launches in each of the last three years, according to data from Eurekahedge.
Nektar, which started in 1998 and is Sweden’s oldest hedge fund, bets on fixed income and foreign exchange markets. It has delivered an average annual return of 9.1 percent, according to the statement.
The fund was down 2.7 percent through April 15 this year, according to a spokeswoman for Brummer. It also lost money in the previous two years.
Brummer, also based in Stockholm, manages about 112 billion Swedish kronor and invests in a number of hedge funds, according to a company statement. After the exit from Nektar, it will have investments in eight money managers.
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