Wed, May 4, 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. Hedge funds see $14.3bn outflows in Q1, CTAs and multi-strategy lead net inflows[more]

    Komfie Manalo, Opalesque Asia: The hedge fund industry saw net outflows of investor capital in the first quarter of the year, totaling $14.3bn, data from Preqin showed. This continues from the $8.9bn overall net outflows that funds recorded in Q4

  2. Third Point calls Q1 "catastrophic" for hedge funds[more]

    Bailey McCann, Opalesque New York: The first quarter of this year was rocky for hedge funds based on aggregate performance from the industry, but now we are beginning to hear what the managers thought of it as quarterly letters make their way to investors. Dan Loeb, CEO of New York-based $17 bill

  3. Asia - Stabilization of China's capital outflows may hinge on Janet Yellen, Fink says China to do well this year as bubble threat postponed, Chinese hedge fund to invest in India’s infrastructure[more]

    Stabilization of China's capital outflows may hinge on Janet Yellen From Bloomberg.com: Whether China’s recent stabilization of its currency and capital outflows continues -- or downside pressure reignites -- may hinge in large part on Janet Yellen. If the Federal Reserve chair sticks to

  4. …And Finally - After all, judges are human too[more]

    From Newsoftheweird.com: In March, one District of Columbia government administrative law judge was charged with misdemeanor assault on another. Judge Sharon Goodie said she wanted to give Judge Joan Davenport some files, but Davenport, in her office, would not answer the door. Goodie said once the

  5. Comment - Unmasking the men behind Zero Hedge, Wall Street's renegade blog[more]

    From Bloomberg.com: Colin Lokey, also known as "Tyler Durden," is breaking the first rule of Fight Club: You do not talk about Fight Club. He’s also breaking the second rule of Fight Club. (See the first rule.) After more than a year writing for the financial website Zero Hedge under the n