Top hedge funds closed again to new money

MONACO (Reuters) - A small number of top hedge funds are once more shutting their doors to new clients in a sign that investors are putting their cash back with the best performing managers, said fund of funds Corazon Capital.

While heavy outflows last year meant almost all hedge funds were open to new investors, Barrie Duerden, director of Corazon Capital, told the GAIM 2009 conference here that in recent weeks some managers were now turning away business again.

"In the last couple of weeks the best managers are closing to new investment," said Duerden, whose firm uses client money to invest across a broad range of hedge funds.

He told Reuters on the sidelines of the conference that it tended to be smaller managers who had now seen sufficient inflows that their funds had reached capacity for those strategies.

He declined to name specific firms.

During the industry's boom period, up until last year, shutting to new investors was common practice and often a badge of prestige for top managers.

However, heavy industry outflows, including around $250 billion (150 billion pounds) between October and March according to Hedge Fund Research, meant practically all funds were opened to new investors last year, fund of funds managers said.

(To read the Reuters Hedge Fund Blog click on blogs.reuters.com/hedgehub; for the Global Investing Blog click here)

(Reporting by Laurence Fletcher; editing by Elaine Hardcastle)