Fri, Nov 27, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Study finds new hedge fund managers offer potential for greater returns

Thursday, November 28, 2013

Beverly Chandler, Opalesque London for New Managers:

The latest Hedge Fund Spotlight from Preqin examines emerging hedge fund managers and finds that hedge funds launched by new managers offer the potential for greater returns. The firm says that first-time funds on average post better returns than funds launched by established firms, but institutional investor interest in emerging managers continues to decline.

Preqin’s figures reveal that the average emerging manager long/short fund launched since 2007 delivered annualized net returns of 8.80% in its first three years of trading, compared with an annual rate of 5.38% from newly-launched funds managed by established firms.

However, first-time funds exhibit more volatility than funds managed by experienced firms. The average annualized volatility of returns during the three years following inception were approximately 14.7% for established manager long/short funds compared with 17.3% for emerging manager long/short funds.

Other key facts to emerge from the study include:

  • 22% of emerging manager funds launched since 2007 made a loss in their first year of trading, compared to 26% of funds launch ed by established managers.
  • However, emerging managers that suffered a loss in the first year tended to experience larger declines. Over a quarter of loss-making emerging manager funds pos......................

    To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Hedge fund marketing and the selling cycle[more]

    By Bruce Frumerman. How long is the selling cycle now? That’s a question my financial communications and sales marketing consulting firm has been asked on a regular basis by hedge fund firm owners and sales people, ever since we opened the doors to our firm in 1987 pre-crash. Wa

  2. People - Solus Alternative Asset Management adds chief strategist from BTIG[more]

    From Daniel Greenhaus joined hedge fund manager Solus Alternative Asset Management as managing director and chief strategist. He will work closely with Chris Bondy, Solus’ chief economist, managing director and executive vice president, said Chris Pucillo, CEO and chief investmen

  3. Opalesque Roundtable: Seeding deal terms can be onerous for hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Executives from fund of funds firms, family offices, a placement agent, a private equity firm, and an accounting firm gathered in Connecticut last month for the

  4. Opalesque Roundtable: Family offices flock to co-investment[more]

    Bailey McCann, Opalesque New York: Co-investments have been a hot topic for pension funds in recent years, as they try to move away from high fees and improve transparency. But now, family offices are more readily getting into the mix and establishing in-house deal teams, according to the delega

  5. More institutional investors invest in CTAs compared to last year despite dissatisfaction with performance[more]

    Benedicte Gravrand, Opalesque Geneva: "Despite a strong start to 2015 for CTAs in Q1, commodity market conditions have made return generation difficult for fund managers over much of the rest of the year to date," says Preqin’s November