Returns Rise In November, Year-End Could Bring Rally

Dec 8 2005 | 5:06pm ET

After a tough ten months and an especially ugly October, hedge fund returns showed improvement in November, and some industry experts are optimistic that things may pick up further in December.

According to Hedge Fund Research, market directional funds showed the best performance during the month, up 3.58%, with global macro coming in second, up 3.13%. The worst performer was convertible arbitrage, which was down 0.33%.

Conrad Gann, president and chief operating officer of TrimTabs Investment Research, attributes November’s improved hedge fund performance to a large number of share buybacks and strong merger and acquisition activity.

“November had $71.2 billion in [share] buybacks, which is the highest we have on record,” said Gann, referring to TrimTabs’ historical data research. It was also “a strong month for announced mergers and acquisitions which involved cash,” he said.

HFR’s Merger Arbitrage Index was up 0.92%, while its Event Driven Funds Index, which tracks funds that also bet on M&A activity, showed returns of 1.49%.

Victor Park, director of Alternative Investment Asset Management, believes that there is a strong possibility of a yearend rally.

“It’s a stock pickers market,” he said. “I think the mood is ‘let it rip.’”

As for 2006, Gann believes that a hot space to be in will be multi-strategy funds. “Multi-strategy funds that can flexibly allocate will continue to gather assets,” said Gann.

Park said, with all of the cash sloshing around these days, “equities aren’t a bad place to be.”  


In Depth

Q&A: Open Season For Closed-End Funds

Aug 29 2014 | 10:00am ET

When Maury Fertig and Bob Huffman, former Salomon Brothers coworkers, launched...

Lifestyle

Och Funds Women In Finance Initiative At U-M

Aug 28 2014 | 3:01pm ET

Och-Ziff Capital founder Daniel Och and his wife have made a "generous donation"...

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.