From Eurekahedge Hedge funds closed the final month of the year in positive territory with the Eurekahedge Hedge Fund Index up another 0.25% in December while the MSCI World Index finished the month down 0.80%. In 2014 as a whole, hedge funds were up 4.57%, falling behind underlying markets as the MSCI World Index returned 6.79% over the same […] Read more »
Outlook: Equities Can Continue to Climb the Wall of Worry in 2015
By Paul Sedgwick, Chief Investment Officer of Frank Investments 2015 Predictions for Investors Hunting Returns – Global equities not cheap but should continue to benefit from supportive backdrop – Low commodity prices should provide boost to global economy – Sentiment suggests equities can continue to climb the wall of worry in 2015 Looking […] Read more »
The Case for Liquid Alts from Credit Suisse Asset Management
From Credit Suisse Asset Management The Appeal of Alternative Investments Hedge fund managers generally have a different focus and objective as well as access to a broader set of portfolio management tools compared to traditional fund managers, including: Focus on absolute returns Broader investment universe Ability to go short This flexibility is part of […] Read more »
Evaluating Hedge Funds – Alphas, Sharpe Ratios & the Underappreciated Appraisal Ratio
By Peter Hecht, Ph. D., Vice President, Senior Investment Strategist at Evanston Capital Management EXECUTIVE SUMMARY • Markowitz’s “mean-variance” modern portfolio theory (“MV-MPT”) teaches us to evaluate investments, including hedge funds, in the context of the entire portfolio. Within MV-MPT, investors want to form portfolios with the highest Sharpe Ratio, i.e. maximize expected excess […] Read more »
K2’s 2015 Outlook – Bias To Lower-Beta Sector Specialists In Equity Hedge
David C. Saunders, Founding Managing Director, & Robert Christian, Head of Research, K2 Advisors We think earnings growth trends should provide support for long/short equity strategies in 2015, particularly in terms of specialty managers in areas such as health care, technology and activism. Meanwhile, opportunities in relative value have continued to evolve due in […] Read more »
Trend-Following Strategies Post Largest Monthly Gain Since 2008
From Newedge, the prime services division of Societe Generale CTAs exit drawdown, setting new high watermarks in November 2014 Managed futures enjoyed a stellar November, with all of the Newedge indices posting the fourth consecutive positive monthly return in a row. The Newedge CTA Index, with a performance of +5.62% for November, posted a […] Read more »
Global Macro and CTAs Outperform Again In November
From Global Asset Management Global equity markets continued on their upward trend from mid-October, finishing November up 2.1%, as measured by the MSCI World index in US dollars. US Treasuries and core European bonds also rallied. Against this backdrop, coupled with a strong US dollar and downward trending oil prices, hedge funds performed positively. […] Read more »
Schroders Multi-Manager Emphasise Hedge Funds Whilst In Capital Preservation Mode
By Marcus Brookes, Head of Multi-Manager Team and Robin McDonald, Fund Manager at Schroders • Assuming global aggregate demand can continue to expand in 2015 equities will likely offer a greater short-term prospective return than fixed income. • Nevertheless, we judge equity valuations from a longer-term perspective, particularly in the US, to be on the […] Read more »
Multi-Strategy Under The Gun As European Hedge Funds Lag
From Hedge Fund Insight staff The latest flow data from Eurekahedge for the hedge fund industry show net outflows from Europe-focused hedge funds. Only two investment strategies could possibly accommodate the scale of monthly redemptions from European funds – fixed income and multi-strategy (Table 1/Figure 2). So it is highly likely that the biggest outflows […] Read more »
Long/Short Equity Outlook Improving On Correlation and Dispersion Changes
By Juliana Hadas and Andrea Pompili of Neuberger Berman The beginning of this decade was a challenging time for long/short hedge fund performance, with the overall universe having generated negative Jensen’s alpha (risk-adjusted excess returns)—see Figure 1. However, alpha has been rebounding starting with the second half of 2012—a trend we believe will continue. […] Read more »