Sun, Jun 26, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Morningstar reports returns of 1.9% for hedge funds over January

Monday, March 04, 2013
Opalesque Industry Update - Morningstar Inc, a provider of independent investment research, reported preliminary hedge fund performance for January 2013 as well as estimated asset flows through December. The Morningstar MSCI Composite Hedge Fund Index, an asset-weighted composite of nearly 1,000 hedge funds in the Morningstar Hedge Fund database, rose 1.9% in January and advanced 6.3% for the trailing 12 months. Almost all Morningstar MSCI hedge fund indexes rose in January, and the trailing 12 months showed declines in only the Short Bias and Systematic Trading categories.

Reduced global economic and political uncertainty during January fueled a broad increase in appetite for risky assets,” Philip Guziec, alternative investing strategist at Morningstar , said. “Excluding the Short Biased category, all hedge fund strategies were up for the month, and the most risk-sensitive strategies posted the strongest performance.” January started with a two-day rally in equity markets that accounted for most of the 5.2% rise in the S&P 500 Index for the month.

The Morningstar MSCI North America Hedge Fund Index, which primarily includes long - short equity hedge funds, ended the month up 2.3%. Small - cap strategies faired even better. The Russell 2000 Index jumped 6.3%, while the Morningstar MSCI Small Cap Hedge Fund Index rose 3.9%. The Morningstar MSCI Emerging Markets Hedge Fund Index also rose substantially, up 3.0% in January , driven by positive economic news from China about GDP and exports. These positive signals also supported the performance of the Morningstar MSCI Asia Pacific Hedge Fund Index and MSCI AC Asia Index, which climbed 4.9% and 2.5% , respectively. Short sellers were caught short by the broad - based rally , however, pushing the Morningstar MSCI Short Bias Hedge Fund Index down 5.2%.

Widespread investor optimism also sent less risky fixed - income strategies , such as those involving Treasuries and investment - grade corporate bond s , down during January, but high - yield and relative - value hedge fund strategies posted gains .

The Morningstar MSCI Long - Short Credit and Fixed Income Arbitrage Hedge Fund Indexes increased 0.7 and 0.9%, respectively, in January.

The month - long equity rally as well as rising prices across the energy, agricultural, and metal commodity futures markets also supported price - trend following managed futures strategies in January , leading to a 2.8% rise in the Morningstar MSCI Systematic Trading Hedge Fund Index .

January’s uptick was not enough to offset previous losses, however , and the Systematic Trading Hedge Fund Index was down 1.2% over the past 12 months. In December 2012, single - manager funds in Morningstar’s Hedge Fund Database saw outflows of $4.7 billion, marking the fourth consecutive month of outflows, and representing more than half of the $7.0 billion that investors pulled from hedge funds in the database during 2012. This was a sharp reversal from investor behavior seen during 2011 and 2010, when funds in the Morningstar Hedge Fund Database received inflows of $17.9 and $10.1 billion, respectively. The largest redemptions came from multistrategy hedge funds, which gave up $1.7 billion , or 35% of the redemptions in the Morningstar database for the month.

Over the calendar year 2012, however, multistrategy funds in the database gathered more assets than any other category of $4.2 billion. Hedge funds in the Systematic Futures category, which trade futures contracts according to trend - following and momentum - based strategies, also suffered in December, losing $826 million, followed by U.S. long / short equity hedge funds, which lost $ 500 million. Only the Distressed Securities , Emerging Market Long - Only Equity , and Debt Arbitrage hedge fund categories posted inflows of $46 million, $25 million, and $2 million, respectively, in December.

Press release

bc

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 Roundup: Hedge funds shrink as liquidations outpace new launches in Q1: hedge fund news, week 27[more]

    In the week ending 17 May, 2016, HFR said hedge fund liquidations declined narrowly to begin 2016 after rising sharply to conclude 2015, as investors positioned f

  2. Europe - Hedge funds keep powder dry over big Brexit bets, Hedge funds sense profit in Europe shock waves after Brexit vote, Soros warns Brexit may cause pound plunge worse than Black Wednesday, After Brexit: What will happen if Britain votes to leave the UK?[more]

    Hedge funds keep powder dry over big Brexit bets From FT.com: Hedge funds are shying away from big bets on Brexit, with many unwilling to risk further losses having already suffered a painful first half of the year. With the outcome of a UK vote on the country’s membership of the Europea

  3. News Briefs - ’Flash Boys’ get green light to launch stock exchange, Pimco says ‘storm is brewing’ in U.S. commercial real estate, Bankers get ready to rumble at Hedge Fund Fight Night, AIMA Australia celebrates 15th anniversary[more]

    ’Flash Boys’ get green light to launch stock exchange In an investing environment ruled by fast, the newest U.S. public stock exchange is banking on slow. Well, slower. IEX Group, which won Securities and Exchange Commission approval on Friday to go head-to-head with the New York Stock E

  4. Blackstone buys minority stake in New York-based credit hedge fund Marathon[more]

    Benedicte Gravrand, Opalesque Geneva: Blackstone Strategic Capital Holdings Fund, a vehicle managed by Blackstone Alternative Asset Management (BAAM), has acquired a passive, minority interest in Marathon Asset Management, for an undisclosed sum. Based in New York,

  5. Global markets fell, hedge funds gain in mid-June on Brexit, Fed rate concerns[more]

    Komfie Manalo, Opalesque Asia: Global financial markets declined through mid-June, as uncertainty associated with the upcoming Brexit referendum and expected U.S. Fed interest rate hike contributed to increases in volatility across asset classes, data provider