Sun, Aug 28, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Asia Pacific Intelligence

Hedge funds attract $50bn in five months and return 0.20% in May, 3.89% year to date

Thursday, June 13, 2013

The May report from Eurekahedge shows that hedge funds witnessed the seventh consecutive month of positive returns in May, despite mixed returns in global markets. The Eurekahedge Hedge Fund Index was up 0.20% during the month, 3.89% year to date, against the backdrop of the MSCI World Index which was down 0.45% in May.

Eurekahedge's key highlights for May 2013 included:
  • Hedge funds witnessed the fifth consecutive month of net allocations and seventh consecutive month of positive returns - up 3.89% year-todate
  • Total asset flows for 2013 currently stand at $50bn with total size of the industry at $1.87tln
  • Asia ex-Japan hedge funds outperformed underlying markets for three consecutive months - up 3.26% since end-February
  • Eurekahedge is currently tracking almost 500 funds that have delivered more than 15% year-to-date and 250 funds that are up by over 20% yearto- date
  • Distressed debt funds extended winning streak to 11 consecutive months, gaining 21% since end-June 2012
  • CTA/managed futures funds declined by 1.69% in May 2013

In terms of the regional indices, Eurekahedge found that May started off on a good note with positive economic data from the US, leading to rallies in global equity markets, specifically in North America where market indices reached all-time highs. The firm writes: “The US dollar strengthened against most major currencies, going above 100 level against the Japanese yen for the first time since 2009. The positive sentiment turned mid-month amid weak manufacturing numbers from China and uncertainty regarding the withdrawal of the US Federal Reserve’s asset purchase program."

Most major hedge fund investment regions delivered positive returns in May, with Asia ex-Japan hedge funds reporting the strongest returns during the month. The managers outperformed the market for the third consecutive month gaining 2.35% in May while the MSCI Asia Ex Japan Index was down 4.35% - the largest returns posted by funds focused on Greater China, up 4% in May. The Eurekahedge Japan Hedge Fund Index grew 0.42% in May, bringing its year-to-date return to 18.34% and extending their winning run to the ninth month making it the longest winning streak on record for Japanese funds.

The firm writes: “The month’s return represents an outperformance by the managers as the Nikkei 225 declined 0.62% while the Tokyo Topix was down 2.52% during May. The Japanese markets witnessed some volatility during the month as the Nikkei fell 7.3% in a single day, amid concerns about US stimulus, before rallying at the month end after some positive announcements from the Japanese central bank."

Turning to North America, the Eurekahedge North American Hedge Fund Index was up 1.06% in May bringing its year-to-date return to 4.46%. The S&P500 was up 2.08% in May but witnessed a mid-month trend reversal, declining to 1630 after reaching an intra-day high of 1687 in the fourth week of May. This trend was also witnessed across European bourses, however most European indices finished the month higher holding on to gains generated after the ECB’s rate cut. The Eurekahedge European Hedge Fund Index grew 0.83% during the month.

In terms of strategy indices, Eurekahedge found that returns were mixed among the different strategic indices, with distressed debt hedge funds posting the strongest gains of 1.87%. “Distressed debt managers have witnessed 11 straight months of positive returns, gaining 21% since end-June 2012” the firm said. “The distressed debt sector gained earlier in the month from the positive sentiment around global economic data while the ECB rate cut triggered rallies in the European distressed bonds sector, but the increased risk aversion at the end of the month led to some losses. The BofA Merrill Lynch High Yield Index was down 0.43% in May."

CTA/managed futures funds were the hardest hit over the month, posting the largest negative returns, declining by 1.69% on average. “Trend-followers suffered due to the reversal in market sentiment mid-month, although some short-term systematic funds witnessed some gains. A number of managers also reported losses from the energy and precious metals sector. On the other hand some managers investing in FX delivered positive returns gaining from short AUD/USD positions” the firm said.

 
This article was published in Opalesque's Asia Pacific Intelligence our monthly research update on alternative investments in the Asia-Pacific region.
Asia Pacific Intelligence
Asia Pacific Intelligence
Asia Pacific Intelligence
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. Strategies - The 'Holy Grail' hedge fund strategy to handle a black swan the size of World War I, Hedge funds get more pushback on terms as enthusiasm for strategy wanes[more]

    The 'Holy Grail' hedge fund strategy to handle a black swan the size of World War I From IBTImes.co.uk: To illustrate a strategic gap common to today's portfolio managers, George Sokoloff, PhD, founder and CIO at Carmot Capital, proposes an interesting thought experiment – a breakdown of

  2. Institutional investors - Investors set to increase allocation to private debt, With investment income key, Richmond retirement system faces funding challenges[more]

    Investors set to increase allocation to private debt Investors are set to increase their allocation to private debt, with 60% revealing they believe the private debt market will grow over the next 12 months, according to a new study by Elian, a leading funds services provider. 41%

  3. Investing - Hedge funds snap up banks, unload Apple, Some of hedge funds' favorite stocks are finally starting to beat the market, Einhorn's Greenlight shifts positions, Treasury yield climbs to two-month high as Fischer joins hawks, 9 stocks smart investors put their money in last quarter[more]

    Hedge funds snap up banks, unload Apple From Barrons.com: Prominent hedge funds have a newfound love of big banks, and some have a distaste for shares of Apple, regulatory filings released last week show. The filings suggest that the funds have been pivoting their portfolios in recent mon

  4. Chesapeake energy seeks $1 billion loan to refinance debt[more]

    From Bloomberg.com: Chesapeake Energy Corp. is seeking a $1 billion loan as the company battered by cratering fuel prices and credit downgrades takes a step to address its $9 billion debt load. The natural gas producer hired Goldman Sachs Group Inc., Citigroup Inc. and Mitsubishi UFJ Financial Group

  5. Institutions - Nordic pension funds magnify focus on unlisted and direct investing, building up teams[more]

    From IPE.com: As bond yields remain at low or negative levels, pension funds and other institutional investors in the Nordic region are stepping up efforts to find higher returns by adding more unlisted investments to portfolios and are expanding in-house teams in order to do this, according to new