Thu, Nov 27, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Morningstar MSCI Composite Hedge Fund Index up 0.5% (est.) in February (2.5% YTD), funds see inflows of $3.3bn in January

Friday, March 22, 2013
Opalesque Industry Update — Morningstar, Inc., a leading provider of independent investment research, reports preliminary hedge fund performance for February 2013 as well as estimated asset flows through January 2013.

The Morningstar MSCI Composite Hedge Fund Index, an asset-weighted composite of nearly 1,000 hedge funds in the Morningstar hedge fund database, rose 0.5% in February and 2.5% in the first two months of the year. Over the trailing 12 months, the index rose 5.4%.

“Most hedge fund managers we track took advantage of the modest rally that continued for risky assets in February,” Philip Guziec, alternative investing strategist at Morningstar, said. “However, trend-following strategies continued to struggle as global markets moved in fits and starts.”

The top three performing hedge fund strategies in February were small/mid cap, European, and emerging market equities. The Morningstar MSCI Small & Mid Cap Hedge Fund Index rose 2.6%, driven largely by one healthcare oriented long/short equity fund. European markets reacted to rising concern over a worsening fiscal crisis after recent Italian elections left the future of austerity measures unclear. Compounding concern was a February 28 announcement from the International Monetary Fund that U.S. government spending cuts could lower global growth. The MSCI Europe Index fell 2.8% in February on the U.S. and European market news, but hedge funds operating in the space, as measured by the Morningstar MSCI Europe Hedge Fund Index, were able to generate a 2.2% increase. Emerging markets also reacted to the gloomy economic news in U.S. and European as well as to gross domestic product growth data that came in below expectations for India and Brazil. While the MSCI Emerging Markets Index declined 1.3%, hedge fund managers took advantage of the dark mood. The Morningstar MSCI Emerging Market Hedge Fund Index rose 1.1%.

Other notable hedge fund indexes with strong performance in February were the Morningstar MSCI Distressed Securities Hedge Fund Index and the Morningstar MSCI Equity Hedge Fund Index, which rose 1.0% and 0.8%, respectively. However, both hedge funds indexes trailed the S&P 500 and Morningstar All-Cap Deep Value Indexes, which rose 1.4% and 1.2%, respectively.p> The worst-performing strategies for February were global macro and trend-following. The challenging conditions of rapid trend reversals that have prevailed for over two years continued in February. The Morningstar MSCI Systematic Trading Hedge Fund Index, which represents trend-following strategies, posted a 1.6% decline, while the Morningstar MSCI Directional Trading Hedge Fund Index, which also includes global-macro strategies, fell 1.2% for the month.

In January 2013, single-manager funds in Morningstar’s hedge fund database had inflows of $3.3 billion, marking the first month of inflows after four months of outflows. Hedge funds in the Multi strategy category had the largest inflows in January, adding $1.8 billion. Global macro hedge funds also saw inflows, gaining $873 million in assets. The biggest outflows occurred in the Long-Only Other and Global Long/Short Equity categories, leaking $738 million and $142 million, respectively, during the month. Over the trailing 12 months, investors have pulled $1.1 billion from hedge funds tracked by Morningstar.

February returns for the Morningstar MSCI Hedge Fund Indexes and January asset flows are based on funds that reported data to Morningstar as of March 18, 2013. Hedge fund investors, managers, consultants, and advisors can access additional information through Morningstar Direct SM, the company’s global research platform for institutions.

Press release, including tables.

Bg

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. Investing - George Soros puts $500m of his money on Bill Gross, Soros, Paulson backed Hispania Activos mulls Realia takeover, Ex-Credit Suisse trader’s hedge fund sees yen shorts as crowded, Hedge hunters double default-swaps as views split, Large hedge fund positions come under pressure, Vikram Pandit's fund picks 50% stake in JM Financial's realty lending arm for $87m[more]

    George Soros puts $500m of his money on Bill Gross From WSJ.com: Before Bill Gross was fully settled in at his new firm, Janus Capital Group Inc., he received an unlikely visit from the chief investment officer of famed investor George Soros ’s firm, according to a person familiar with t

  2. Unlucky Paulson & Co. rebrands $1.6bn Recovery Fund after 13% drop[more]

    From Businessweek.com: A maturing U.S. economic recovery is prompting Paulson & Co. to change course. The $19 billion hedge fund firm, led by billionaire John Paulson, told investors on a conference call this month that the Paulson Recovery Fund will be renamed Paulson Special Situations Fund on Jan

  3. Europe - Hedge funds face exit tax as Iceland central bank discusses plan[more]

    From Bloomberg.com: Hedge funds and other creditors with claims against Iceland’s failed banks face an exit tax as the island looks for ways to unwind capital controls without hurting the economy. The government targets having a plan it can present by year-end that would map out how Iceland will sca

  4. Opalesque Exclusive: Risk management emerges as a competitive focus area for hedge funds[more]

    Bailey McCann, Opalesque New York: Risk management has always been a core component of any trading strategy, as well as a critical part of business management. However, as macreconomic weakness persists, and alpha becomes increasingly hard to generate, risk management as emerged as a more promin

  5. Gross: Inflation is required to pay for prior inflation[more]

    Benedicte Gravrand, Opalesque Geneva: As inflation rises, every dollar will buy a smaller percentage of a good. While deflation will mean a decrease in the general price level of goods and services. These two economic conditions are both in the waiting room. The consensus would like the former to