http://investing.reuters.co.uk/news...5Z_01_N28249121_RTRIDST_0_HEDGEFUND-FLOWS.XML NEW YORK, Aug 28 (Reuters) - Investors poured $41.1 billion into hedge funds in the 2007 second quarter, which combined with performance gains, swelled industry assets to an estimated $1.67 trillion by the end of June, fund tracker Lipper TASS said on Tuesday. The gains, which marked the second biggest quarterly inflow since 1994, came mostly before recent turmoil struck many hedge fund strategies due to market volatility due to the subprime lending market meltdown. Still, the turmoil that escalated during the summer isn't having a significant impact on investors' resurgent appetite for hedge fund strategies, Lipper said. "Today the big bulk of inflows are coming from institutional investors who have a longer-term horizon," said Ferenc Sanderson, senior hedge fund analyst for Lipper, a unit of Reuters Group (RTR.L: Quote, Profile , Research). "The inflows may take a knock, but will still remain firm. There's no panic and running for the doors." During previous periods of outflows, such as after the Long-Term Capital Management collapse in 1998, hedge fund investment was largely from high net worth investors, who tend to pull back quicker during market changes than institutions, said Sanderson. The second quarter inflows, which were the second highest since the same period in 1994, came amid "relatively strong performance" for hedge funds of 5.19 percent by June 30, according to the Credit Suisse/Tremont Hedge Fund Index. The aggregate hedge fund performance didn't exceed market indices for the period, however. The S&P 500, for instance, returned 6.28 percent, while the MSCI World TR returned 6.71 percent. The biggest inflows, according to Lipper, were for long-short equity strategies, which gained $14.9 billion, followed by event-driven funds, which gained $12.2 billion. Multi-strategy funds gained $6.1 billion during the period. Strategies that posted net outflows included global macro funds, which bet on world currencies and sovereign debt and were down by $848 million, and managed futures, which were down by 686.7 million, Lipper said. (Reporting by Dane Hamilton) © Reuters 2007. All Rights Reserved. | Learn more about Reuters