Survey: Hedge Funds Expect Worst From Fed Tapering

Dec 11 2013 | 10:40am ET

Hedge fund managers polled by New York-based research firm Aksia are “overwhelmingly negative” on the potential impact of Federal Reserve tapering on markets.

Most managers surveyed expect tapering to begin during Q1 2014 and 75% of respondents expect a significant negative impact on global markets. That said, only 10% expect rising rates will hurt their strategies.

Aksia conducted the survey in late October through early November, polling 198 managers collectively managing more than $1 trillion in hedge fund assets.

"The survey gets inside the heads of managers and illustrates their opinions about both the markets and the hedge fund business," said Jim Vos, Aksia CEO, in a statement. "While altogether a fairly cynical bunch, especially when it comes to newfangled hedge fund businesses, there is also a good degree of optimism about regulatory improvements, the functioning of the markets and longer term economic prospects."

Hedge fund managers, according to the survey, hold “a very poor opinion” of global political institutions but rather like central banks, especially the Bank of Japan and that country's prime minister who were given a 'B' grade for their handling of the economy and growth stimulation. The U.S. Congress, on the other hand, merited a 'D' (and a dunce cap) with a full 38% of respondents awarding Congress an 'F.'

Aksia also discovered that the average manager estimates they need to deliver 9% annualized returns to keep investors happy; that very few managers (1%) plan to advertise despite the lifting of the ban on hedge fund advertising by the JOBS Act; that most (70%) have no plans to offer 40 Act products; and that barely 10% are actively applying environmental, social and governance policies and socially responsible investing policies to their portfolios, despite the popularity of ESG/SRI with investors.


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

Lifestyle

Hedgies, Economists and Musicians Mingle At Milkin Mixers In Hamptons

Aug 25 2014 | 6:00am ET

Leave it to Michael Milken to bring some gravitas and sweat to the Hamptons -- along...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.