Wed, Jun 29, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge funds track equities to record levels in Q1 2013; HFRI Fund Weighted Composite Index +1.2% in March (+3.9% Q1)

Saturday, April 06, 2013
Opalesque Industry Update: Hedge funds extended gains in March to conclude 1Q13 at record levels, tracking U.S. equity performance, which also advanced to close the quarter at new highs. The HFRI Fund Weighted Composite Index gained +1.2 percent in March bringing the 1Q13 gain to +3.9 percent, with top contributions from Fixed Income-based Relative Value Arbitrage and Equity Hedge and strategies, as reported today by HFR, the established global leader in the indexation, analysis and research of the global hedge fund industry.

The HFRI Fund Weighted Composite Index closed 1Q13 with a net asset value (NAV) of 11,482, surpassing the previous peak set in April 2011, concluding a 20-month drawdown in 1Q and creating a new performance high watermark for the industry. An investment of $1,000 in the hedge fund industry at the start of 1990, as represented by the HFRI, would have grown to $11,482 as of the end of 1Q13, an 11.5x increase. A similar investment in the S&P 500 would have grown by approximately 7.3 times.

March gains were led by Fixed Income-based Relative Value Arbitrage strategies, with the HFRI Relative Value Arbitrage Index gaining +1.5 percent in the month and +3.8 percent for 1Q13. RV gains were driven by credit multi-strategy and yield alternative exposures (including MLPs), with the HFRI RV: Multi-Strategy Index gaining +2.9 percent in March and +5.2 percent for the quarter, while the HFRX MLP Index gained +15.4 percent for 1Q13.

Equity Hedge led strategy gains for 1Q13, as the HFRI Equity Hedge Index gained +1.5 percent in March and +5.3 percent for the quarter; Fundamental Value strategies advanced +7.2 percent in 1Q while HFRI EH: Technology/Healthcare Index gained +6.3 percent for the quarter.

As a direct result of the dynamic and robust environment for corporate transactions and increased shareholder accountability pressures, Event Driven hedge funds also made positive contributions to industry performance, with the HFRI Event Driven Index gaining +1.0 percent for March and +3.8 percent for 1Q13. Hedge Funds focused on Special Situations advanced +4.7 percent for the quarter, while Activist managers gained +8.6 percent in 1Q13.

Macro funds also posted gains in the first quarter, but these were tempered by commodity declines, currency reversals and falling equity volatility. The HFRI Macro Index gained +0.5 percent in March and +1.4 percent for 1Q13, with Active Trading and Currency-focused strategies gaining +3.2 and +2.0 percent, respectively, for the quarter. The HFRI Macro: Systematic Diversified CTA Index gained +1.2 percent for 1Q13, while Commodity focused strategies declined by -1.0 percent.

The HFRI Fund of Hedge Funds Index gained +1.0 percent in March, while the HFRI Emerging Markets Index declined by -1.0 percent for the month, paring its 1Q13 gain to +2.4 percent.

“Despite certain differences, 2013 has started in a very similar manner to 2012, with a risk-on trading environment contributing to strong performance from equities and more balanced gains from hedge funds as Macro risks remained pronounced,” said Kenneth J. Heinz, President of HFR. “Extensive stimulus and quantitative easing have comprised a base of support for U.S. & Japanese equities in recent months, but the risks of competitive currency devaluations, extraction of QE stimulus and evidence of labor market weakness have grown as well, prompting many managers to adopt conservative positioning by reducing net exposure to the equity market rally. Through this environment, hedge funds are likely to continue producing balanced gains in coming quarters, independent of the prevailing risk regime and trading conditions.”

HFR

Press Release

BM

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. 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,

  2. Investing - Soros, Druckenmiller among hedgies profiting in market plunge, Hedge funds were most bullish on bonds since 2004 before Brexit, Surprise Brexit vote unleashes scramble for dollars, High-yield hit on Brexit but no panic selling, Scientist turned hedge fund founder lured to pound, euro, Hedge fund avoids commodities, posts big gains[more]

    Soros, Druckenmiller among hedgies profiting in market plunge From HITC.com: Bullish positions in gold and volatility and well-timed short bets on China and emerging markets, among other areas, were some of the trades that benefited hedge funds on Friday as markets digested Britons' s

  3. Manager Profile - A 26-year old hedge fund manager called Brexit — here's what he thinks about the historic vote[more]

    From Businessinsider.com: Taylor Mann is not your typical fund manager. The twenty-six year old Texas A&M graduate manages Pine Capital in Larue, Texas (population 160), where he resides with his three-year old daughter. Also atypical compared with many of the largest funds out there, Mann makes

  4. Visium hedge fund manager Sanjay Valvani found dead[more]

    Benedicte Gravrand, Opalesque London: A hedge fund manager connected with an insider trading case has apparently committed suicide. Sanjay Valvani, 44, a hedge fund manager at New York-based Visium Asset Management, was found dead in an apparent suicide on 21 June in his Brooklyn residence,

  5. People - Mariner Investment’s co-CIO Williams to leave $5.5bn firm, IOOF hires new alternatives portfolio manager[more]

    Mariner Investment’s co-CIO Williams to leave $5.5bn firm From Bloomberg.com: Basil Williams, co-chief investment officer of Mariner Investment Group, is leaving the $5.5 billion hedge-fund firm after negotiations to renew his contract failed. Williams will stay in his role until t