Wednesday, 1 October 2014
Last updated 7 hours ago
Jul 9 2010 | 11:42am ET
(Most of) the numbers are in, and it’s safe to say that June was not a good month for the global hedge fund industry.
The latest benchmark to show a June swoon is the HFRI Fund Weighted Composite Index, which dropped 0.81% last month, pushing it into the red for the first half with a 0.18% loss. While hardly a bloodbath, three of the HFRI indices’ four major strategy groups were in the red, and half of its 14 substrategy indices were also losers on the month.
Equity hedge funds were hardest-hit, shedding 1.5% on the month (down 1.6% year-to-date). Indeed, the only equity hedge funds that did well in June were—surprise, surprise—short bias funds, which took advantage of continued market difficulty to jump 3.73% on the month (down 3.06% YTD), the best of any strategy, substrategy or regional index.
“In contrast to the environment of the last two years, the drivers of hedge fund performance have recently shifted to tightening corporate credit, declining equity market volatility, currency adjustments and rising sovereign credit risk,” said Ken Heinz, president of Hedge Fund Research. “While allocations reflect continuing trends in Event Driven & Arbitrage strategies, investors are also focusing on fund structure and transparency, as well as new opportunities presented in currency, commodity and fixed income markets.”
Event-driven funds fell 1.1% (up 2.43% YTD), “led” by private issue and Regulation D funds, which suffered a 2.8% drop (up 4.26% YTD), the second worst of any strategy or substrategy. Macro fund lost 0.23% on the month (down 1.27% YTD).
Emerging markets funds also took a hit, falling 0.63% on the month (down 1.46% YTD). Russian and Eastern European funds took it on the cheek, dropping 2.9%, with the consolation that they remain up 0.56% on the year. The month’s two EM “winners,” Latin America and Asia ex-Japan, cannot say the same: They remain down 3.67% and 2.41%, respectively, despite 1.22% and 0.07% returns last month.
Relative value funds managed a small gain in June, rising 0.4% (3.66% YTD). All but one of the HFRI relative value subindices were up last month, led by fixed-income convertible arbitrage (1.51% in June, 3.62% YTD) and yield alternatives (1.26%, 3.13% YTD).
Funds of hedge funds shed 1.08% last month and are down 1.39% on the year.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
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