Sat, Sep 5, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

HFR: Emerging markets hedge funds top industry performance, fail to attract new investor capital in Q3 2010

Friday, December 03, 2010
Opalesque Industry Updates - Hedge funds investing in the high-growth emerging markets of Russia, Latin America, Emerging Asia and the Middle East have produced the strongest YTD gains across the hedge fund industry, according to the latest data from Hedge Fund Research, Inc., which today released the HFR 3Q Emerging Markets Industry Report. The HFRI Emerging Markets (Total) Index has gained +9.3 percent through October, outpacing the +6.8 percent gain of the broad-based HFRI Fund Weighted Composite Index.

Despite the gains, investors remained cautious on new allocations to Emerging Markets hedge funds, allocating only $10 Million of net new capital to EM funds in 3Q10. In comparison, investors allocated over $19 Billion of new capital to hedge funds focused primarily on developed markets over the same period. Performance based gains resulted in an asset increase of over $10 Billion to EM hedge funds, bringing total AUM in these to nearly $105 Billion, the highest AUM level since 2Q08.

Regionally, funds investing in the Middle East and Emerging Asia have posted the strongest gains, trailed by Russia and Latin America. The HFRX MENA Index has gained +13.3 percent and HFRI EM: Asia ex-Japan Index returned +9.5 percent through October, while the HFRI EM: Russia/Eastern Index and the HFRI EM: Latin America Index have returned +9.5 and +6.7 percent, respectively.

Trends toward localization, secular growth and UCITS III pervasive in EM
The trend of Emerging Market-focused funds locating in the markets in which they invest also continued, with increases in the number of firms locating to Singapore, China and Brazil. At the same time, the percentage of EM firms located in the U.S. and UK continued to decline, falling to less than half of all EM funds.

More than two-thirds of all Emerging Markets funds are Equity Hedge strategies, more than double the overall industry average of thirty percent. Fewer EM funds offer Relative Value Arbitrage or Event Driven exposure, while the percentage of EM funds focusing on Macro strategies is only slightly lower than the overall industry. EM fund managers have expanded the number of funds compliant with UCITS III guidelines; in total, more than 120 Emerging Market hedge funds are presently UCITS III compliant.

“As global investors continue to focus on sovereign credit and currency risks, performance gains in Emerging Market hedge funds have failed to attract net new investment capital,” said Kenneth Heinz, president of Hedge Fund Research, Inc. “However, emerging markets hedge funds offering more strategic exposure, UCITS III conformity and local-market specialization are likely to appeal to investors as the EU sovereign credit crisis continues.”

(press release)

About HFR
Hedge Fund Research, Inc. (HFR) is the global leader in the alternative investment industry. Established in 1992, HFR specializes in the areas of indexation and analysis of hedge funds. HFR Database, the most comprehensive resource available for hedge fund investors, includes fund-level detail on historical performance and assets, as well as firm characteristics on both the broadest and most influential hedge fund managers. Corporate website: www.HFR.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: New Detroit-based CTA seeks to take advantage of coming volatility[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: An emerging manager has just set up his one-man shop in the city of Detroit. Synchronicity Futures,

  2. Opalesque Exclusive: When the SEC calls, fund managers need to get out of their own way[more]

    Bailey McCann, Opalesque New York: New pressure is hitting alternative investment funds from all angles. So far this month both hedge fund and private equity players have seen enforcement actions, and subsequent fines over fees, disclosures, and misleading statements. Citi one of the biggest

  3. Fortress hedge fund manager David Dredge says markets trouble on the way[more]

    From AFR.com: David Dredge of global hedge fund Fortress has built a career studying, predicting and protecting against the world's major financial crises. The recent convulsions in global sharemarkets are "just the beginning" of a painful adjustment as money drains from the emerging market economie

  4. North America - Puerto Rico agency plans talks with hedge fund creditors[more]

    From WSJ.com: Puerto Rico’s Government Development Bank is planning to begin confidential debt-restructuring talks with hedge funds that own its bonds as early as next week, said a person familiar with the matter. The parties are set to discuss a plan under which the investors would lend additional

  5. Launches - BlackRock’s McKenna starts hedge fund with $270m, Ex-BlueBay fund managers Phillips, Fayman to launch hedge fund in 2016, Dallas lawyer, Wall Street-savvy doctor team up to form biotech-focused hedge fund[more]

    BlackRock’s McKenna starts hedge fund with $270m From Bloomberg.com: BlackRock Inc. has started an event-driven hedge fund one year after hiring Harvard Management Co.’s Mark McKenna to run the strategy. Global Event Partners, which seeks to profit from corporate events such as takeovers

 

banner