Creeping Hedges: Study Shows Funds’ Growing Reach

Public companies are increasingly likely to have hedge funds as large shareholders, a new study suggests. Conducted for Financial News by Gartmore, a British fund manager, the study found that hedge funds now have significant stakes — more than 5 percent — in 38 percent of public companies worldwide, up from 24 percent two years ago. Given many hedge funds’ tendency to shake things up at companies in which they invest, chief executives might want to brace for some turbulence.
Hedge funds are more often taking large stakes as well. The study found that in one-fifth of all public companies, hedge funds hold stakes of 10 percent or more, twice the proportion as in 2004.