Sat, Aug 29, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Morningstar 1000 Hedge Fund Index rose 0.7% in April, single strategy head funds gained inflows of $2.7bn in March ($835m for 1Q10)

Wednesday, May 26, 2010
Opalesque Industry Updates - Morningstar, Inc, a provider of independent investment research reported preliminary hedge fund performance for April 2010 and asset flows through March. In April, the Morningstar 1000 Hedge Fund Index rose 0.7% while the currency-hedged Morningstar MSCI Composite Index increased 1.1%. For the first four months of the year, these indexes were up 2.2% and 3.6%, respectively.

“April was a solid month for hedge funds,” said John Rekenthaler, Morningstar’s vice president of research. “Nearly every category of hedge fund experienced a gain in April, as most global assets rose for the month. The main exceptions were in Europe, which suffered from Greece’s economic crisis, but even European hedge funds fared well if they reduced their exposure to the euro by hedging into other currencies.”

The strongest performer among the Morningstar Hedge Fund Indexes was the U.S. Small Cap Equity category, with a gain of 2.6%. Once again, small U.S. stocks charged to a large gain, as the Russell 2000 Stock Index increased 5.7% in April, and 15.0% for the year to date. With a much more modest year-to-date rise of 5.5%, funds in the Morningstar U.S. Small Cap Equity Hedge Fund Index generally shied away from maintaining anything like full exposure to the stock market.

With the U.S. economy strengthening, the economically sensitive categories of Distressed Securities, Debt Arbitrage, and Corporate Actions all performed well. At an increase of 2.3%, the Morningstar Distressed Securities Hedge Fund Index was the month’s second-best performer, and remains in first place for the year to date among hedge fund categories with a rise of 9.9%. Close behind is the Corporate Actions Hedge Fund Index with a 2010 gain through the end of April of 8.1%.

Less happily, the Morningstar Short Equity Hedge Fund Index had a disappointing loss of 4.1% for the month, as the short managers in the index were neither able to hedge their stock-market exposure, nor to target relatively weak securities. The Short Equity index is now down 6.4% for the year to date through April, continuing an almost unabated decline since March 2009. The Morningstar Equity Arbitrage Hedge Fund Index shed 0.2% for the month, as equity-arbitrage managers struggled to find their bearings in a 2010 market that has seen them drop 1.3% for the year to date. Finally, the unhedged Morningstar Europe Equity Hedge Fund Index fell 0.5% for the month, while the currency-hedged Morningstar MSCI Europe Hedge Fund Index rose 0.7%.

With broadly diversified hedge funds, the Morningstar Multi-Strategy Hedge Fund Index comfortably outpaced the typical hedge fund of funds, picking up 0.7% in April as opposed to the 0.2% increase for the Morningstar Hedge Funds of Funds Index. For the year to date through April, the Multi-Strategy index has a modest but significant increase of 2.1%, while the Funds of Funds index is barely positive at 0.1%. In aggregate, Funds of Funds have struggled to keep pace with Multi-Strategy funds in recent years, and 2010 is appearing to be no exception.

Single-strategy hedge funds in the Morningstar database saw overall inflows of $2.7 billion in March, bringing flows into positive territory for the year of approximately $835 million through the first quarter. Source

kb

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 - Hedge funds suddenly find real money is back in Argentina's debt, Elon Musk buys more SolarCity stock following hedge fund manager short, BlackRock plans to get into rental-home financing[more]

    Hedge funds suddenly find real money is back in Argentina's debt From Bloomberg.com: The real money is back in Argentina. Before the country’s default in July 2014 (its second in 13 years), most long-term investors abandoned its bond market. As they rushed out, Argentina became a favorit

  2. Activist News - Carl Icahn has snapped up a huge stake in Freeport-McMoRan, and the stock is ripping, Meet Europe's best activist investor[more]

    Carl Icahn has snapped up a huge stake in Freeport-McMoRan, and the stock is ripping From Businessinsider.com: Carl Icahn has picked his next target: Freeport-McMoRan. Icahn and a group of other investors have snapped up an 8.46% stake in mining company Freeport-McMoRan, according to a j

  3. North America - Hedge fund manager Ray Dalio’s challenge to the Fed[more]

    From Newyorker.com: For some reason, Janet Yellen, the chair of the Federal Reserve, decided to skip this year’s annual Fed conference in Jackson Hole, where monetary policymakers from the United States and abroad get together with some prominent academics to discuss the big issues of the moment. Th

  4. Opalesque Exclusive: Credit-focused hedge fund Numen Capital expects more volatility in Europe in coming months[more]

    Benedicte Gravrand, Opalesque Geneva: A London-based hedge fund, which has just hired two emerging managers, is cautious on Europe. Vassilis Paschopoulos and former Lehman’s colleague Nikos Kargadouris, launched a London-based credit-focused hedge fund called

  5. Performance - Hedge funds bruised by stocks’ meltdown, Capstone’s volatility hedge fund is having a monster month thanks to market mayhem[more]

    Hedge funds bruised by stocks’ meltdown From WSJ.com: Hedge-fund managers like to promise their investors protection from market swings. In the recent stock swoon, many were caught off guard. Billionaire managers such as Leon Cooperman, Raymond Dalio and Daniel Loeb are deeply in the red

 

banner