Hedges here to stay, says Merrill analyst

Hedge funds accounted for 28% of the fund management industry’s revenues last year, according to research from Merrill Lynch, Financial Times reported.
That’s up from 20% in 2005.
However, hedge funds likely manage about 3% of the asset management industry, including private equity, Philip Middleton, a Merrill analyst told the newspaper.
The increase in revenues is mostly due to high fees and strong sales, and fueling the interests of large investment banks in hedge fund management companies, according to Financial Times.
For instance, JPMorgan Chase & Co. of New York last week bought its fifth hedge fund holding, a 20% stake in Spinnaker Capital.
These numbers signal that hedge funds are not just a trend, a Merrill analyst told Financial Times.