LONDON- Assets under management at global hedge funds topped $4 trillion for the first time ever at the end of 2021, as the prospect of rising interest rates combined with the pandemic made for a volatile end of the year, industry tracker HFR said on Thursday.

The jump represents a turnaround from the first quarter of 2021, when total assets slipped below the $3 trillion mark. Despite the surge in popularity of relatively low-cost indexed funds, total assets have doubled over the past decade.

Hedge funds posted double-digit returns annually in 2021 for a third consecutive year with a fund weighted composite index rising more than 10% last year, according to HFR.

(Reporting by Saikat Chatterjee; Editing by Danilo Masoni) ((saikat.chatterjee@thomsonreuters.com; +44-20-7542-1713; Reuters Messaging: saikat.chatterjee.reuters.com@reuters.net))