Thursday, 1 September 2016
Last updated 5 hours ago
Dec 20 2006 | 3:21pm ET
By Hung Tran
Hedge fund managers who got hammered by the Japanese and South Korean equities markets or the currency and distressed debt markets this year should look ahead to better days in 2007, according to Virginia Parker, founder of Stamford-based Parker Global Strategies.
Parker, speaking to a group of journalists in New York yesterday, said that although the HFR Composite Index ended November up 11.4%, that it doesn’t tell the whole story of “where the money was made and where money wasn’t made.”
The top 72 equities markets worldwide were all positive, and the Asian markets performed quite well, with the exception of Japan and Korea, said Parker. “Although Japan looks okay on the surface, what a number of people don’t realize is that there was some real damage done in the mid-cap area,” she said.
Looking ahead to 2007, Parker said the firm continues to be bullish on the global equity market, especially in Asia where she thinks there are some good values.
“We expect to see Japan turn around and probably see some strength in Korea as we look ahead. Also, we think China should do well next year as foreigners continue buying in that market. We also like Singapore,” she said.
The currency markets were also a tough bet for managers this year, at least until October when the U.S. dollar showed weakness. However, Parker expects 2007 will be a better year for currency managers because of expected weakness in the U.S dollar driven by the Federal Reserve’s probable lowering of interest rates in the second half of next year, if not sooner, and the potential rise of interest rates in Japan and Europe.
In addition, Parker believes that distressed investors will continue to prove that their performances this year was no fluke and “probably” perform well again in 2007. “To many market participants, 2006 was a much better year than a number of people had expected,” she said.
Parker Global’s approach to investing globally tends to be fairly thematic, according to Parker, who said certain sectors that the firm likes going forward include: global energy, natural resources (specifically the global water sector), U.S. Master Limited Partnerships, and the global technology, media and telecom space.
Parker Global is a fund of hedge funds manager and has advised on the placement of over $1.75 billion since its inception in 1995.