Fri, Aug 1, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

TrimTabs/BarclayHedge: Hedge fund managers remain downbeat on U.S. equities, cite currency wars as biggest threat to global financial stability

Monday, November 01, 2010
Opalesque Industry Update - Hedge fund managers remain downbeat on U.S. equities according to the TrimTabs/BarclayHedge Survey of Hedge Fund Managers for October. About 39% of the 102 hedge fund managers the firms surveyed in the past two weeks are bearish on the S&P 500, up from 37% in September.

“The lean toward bearishness surprises us a bit because extreme caution in September produced substantial underperformance,” said Sol Waksman, CEO of BarclayHedge. “We suspect managers will invest much more aggressively in the current quarter. Stock prices keep grinding higher, and hedge funds hauled in $18.8 billion in the past three months. Managers have to put that fresh cash to work.”

About 32% of managers cite currency wars as the biggest threat to global financial stability, and 36% feel world leaders should focus on the problem of too-big-to-fail institutions at the November 11-12 G-20 Summit in Seoul. Only half of managers think a Republican party victory in the U.S. midterm elections will be a plus for stocks, while a quarter feel it will have no impact.

“That Republicans will seize control of the House tomorrow is already baked in,” explained Vincent Deluard, Executive Vice President at TrimTabs. “Also, while the Fed is capable of inflating the value of stocks and bonds, hedge fund managers are seasoned enough to know there is little politicians can do to juice asset prices.”

About 28% of hedge fund managers are bearish on the 10-year U.S. Treasury note, the largest share since the inception of the survey in May. In contrast, 32% of managers are bullish on the U.S dollar index, the largest share since June. Only 9% of managers aim to decrease leverage in the coming weeks, while 19% plan to increase it.

“Why are downbeat managers inclined to lever up? Short rates that round to zero mean borrowing is virtually costless—that’s an attractive incentive,” noted Deluard. “Also, a third of hedge funds are underwater for the year, and half posted a return smaller than 2% through September. Many managers need a blockbuster Q4 in order to collect performance fees for the year.”

The TrimTabs/BarclayHedge database tracks hedge fund flows on a monthly basis. The TrimTabs/BarclayHedge Hedge Fund Flow Report provides detailed analysis of these flows as well as relevant topical studies. Click here for further information.

(press release)

BarclayHedge is a leading hedge fund data vendor and one of the foremost sources for proprietary research in the field of alternative investments. From its origin as a research specialist and performance measurement firm, BarclayHedge has developed complete client services as a publisher, database and software provider, and industry consultant.

TrimTabs Investment Research is the only independent research service that publishes detailed daily coverage of U.S. stock market liquidity--including mutual fund flows and exchange-traded fund flows--as well as weekly withheld income and employment tax collections. Founded by Charles Biderman, TrimTabs has provided institutional investors with trading strategies since 1990. Corporate website: www.trimtabs.com

- FG

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
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. Opalesque Exclusive: Kyria Capital Management bets on women hedge fund managers[more]

    Bailey McCann, Opalesque New York: As hedge fund assets top $3 trillion, and long/short strategies get more crowded than ever, with every manager hunting for even the tiniest bit of alpha, a new firm has emerged that claims its own edge – women. A recent Rothstein Kass study showed women-owned a

  2. Hedge fund manager Winton Capital making headway with long-only strategy[more]

    From PIonline.com: North American investors are helping Winton Capital Management Ltd. make progress — albeit slowly — toward its founder's goal of becoming a $100 billion company. The firm's ticket to quadrupling its assets under management is unlikely to be one of its scientifically designed manag

  3. Opalesque Roundtable: Success in hedge fund marketing not linked to performance, but investor appetite[more]

    Komfie Manalo, Opalesque Asia: Success in marketing a fund is not linked to the performance, but to investor appetite, to the way you can market the fund, and to how much time you can spend to raise assets, said Antoine Rolland, the CEO of incubator and seeding firm

  4. Opalesque Radio: Now is a good time to buy protection cheaply in the options market[more]

    Benedicte Gravrand, Opalesque Geneva: Investors are showing an increased interest in risk parity funds and strategies, Opalesque reported last year. Risk parity strategies have the

  5. The Big Picture: Charlemagne Capital smoothes risk out of frontier market investing with portfolio approach[more]

    Benedicte Gravrand, Opalesque Geneva: Opalesque recently talked to one of the portfolio managers of the Oaks funds, which are emerging and frontier market hedge funds focusing on equity long/short with a directional approach. They are run by