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From Komfie Manalo, Opalesque Asia:
Swiss banking group Syz & Co. said in its "3A Alternative Outlook" report on 12-Mar-09 that the hedge fund industry was slowly recovering, as the HFRX Global Index was up YTD and its flat returns in February had strongly outperformed equity indices.
However, the banking group said not all alternative strategies were attractive, and it was still too early to invest in the distressed credit space.
But while there are some real improvements in liquidity, as the markets resume more fundamental trading conditions, the industry is not yet out of the woods. Here is 3A's outlook by strategy.
Long/short equity
Long/short managers provided significant opportunities to capture alpha without being fully exposed to the markets and produced some returns. The 3A report said a combination of market neutral and low net exposure managers, as well as highly trading-oriented managers, would produce decent and consistent return in the near term,.
Event driven
Event driven and merger arbitrage managers posted positive returns in both February and January.
The report said the global M&A market could experience substantial transaction volumes, both in terms of deal numbers and size, given that a number of companies had entered the downturn in markets well prepared and with ample financial headroom.
Credit
The report advised managers to be ca...................... To view our full article Click here
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