The research from Aima defines institutional investors as pension funds, university endowments, foundations and governmental authorities. The figures were produced by Aima's research department, and were based on extensive consultation with the association's members.

'Traditionally, high net worth individuals accounted for most of the assets under management by the hedge fund industry globally, but institutional investors have been steadily increasing in significance in recent years,' says Aima research manager Tom Kehoe.

'We think institutions now account for an absolute majority of assets under management and that pension funds account for about a third of that, or one-sixth overall. These figures are estimates, but they are informed by all the data at our disposal.'

Aima chief executive Andrew Baker (pictured) says: 'These figures demonstrate that the hedge fund industry plays an extremely important role globally for the institutions that look after everyone's pensions and savings.

'Hedge funds and funds of funds are skilled at managing risk and delivering stable returns, which institutions need at this time more than ever. They offer an extension of investment capabilities to institutional investors through their skills and expertise.'

Founded in 1990, Aima has more than 1,200 corporate members in 43 countries including hedge fund managers, fund of hedge funds managers, prime brokers, providers of legal and accounting services and fund administrators.