Broadly speaking, hedge funds were flat for the quarter (the Credit Suisse Hedge Fund Index returned 0.6% and the HFRI Fund Weighted Composite Index, -0.1%). Performance in many equity markets was much worse for the quarter, with the Russell 2000® returning -7.4%, MSCI Europe, -7.0%, and MSCI Emerging Markets, -3.4% (all in US$ terms). Larger-cap…
Executive Summary Managed futures refers to a subset of investment strategies that actively trade global fixed income, currency, commodity, and equity markets via futures and forward contracts. Approximately 70% of the capital deployed within managed futures programs is attributable to trend following strategies. Trend following is synonymous with momentum investing and is based on the…
Asia’s economic development continues to attract global investor’s interest. Yet, investing in Asia-focused hedge funds has proved challenging due to illiquidity, shorting constraints, and underdeveloped legal systems. Moreover, Asia consists of many diverse economies and heterogeneous cultures, each presenting unique challenges and at different stages of economic and financial market evolution. In this report we:…
The same quiet economic and financial environment, with strong equity markets, that muted returns for hedge funds in the first quarter continued during the second. While the US stock market rallied almost 5%, the yield on the US ten-year dropped 20 bps and the yield curve essentially moved in parallel. Not surprisingly, the VIX declined…
Market Results First quarter results for most equity markets were generally positive, if muted, but the seemingly benign final numbers understated a relatively turbulent first quarter. Most major equity markets opened the year with a meaningful drawdown but snapped back aggressively in February. March produced modest returns in total, but under the surface there was…
Institutional investors considering an allocation to a hedge fund are typically reasonably equipped to evaluate its suitability for their portfolios. However, traditional yardsticks are inadequate for evaluating multi-manager (MM) hedge funds. Due to the uniqueness of their organizational structure and fund terms, MM funds often exhibit unusual yet ultimately explainable behavior. The intention of this…
Grain demand from the emerging world is likely to persist, although given rich land prices in some regions, investors should proceed carefully in this developing asset class.
Executive Summary Manager selection is critical when investing in hedge funds. Every analysis of a potential hedge fund allocation boils down to a granular assessment of a fund’s value proposition as reflected in its investment philosophy, terms, and business operations. Equally important is the need to identify the specific role each fund serves as part…
The Investment Manager Fees report is an examination of average fees for long-only managers in our database, as well as fees and terms for select hedge fund managers for which we have data.
As modern portfolios evolve, investors continue to seek new ways to diversify exposures and mitigate volatility. Currency exposure, once thought of exclusively as a risk to be hedged away, is today being embraced by some in mandates designed to generate returns. The form of such a mandate may vary widely, from a discrete, active strategy,…