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From Kirsten Bischoff, Opalesque New York:
Short-biased funds have struggled through 2009 as global equity markets have regained ground rapidly amidst anticipation of economic recovery. However, the outstanding performance of many short-biased funds through the worst months of the financial crisis, and strong performance during setbacks during the current bull rally continue to make the case for a slice of dedicated short investments within the context of larger portfolio.
Investors continue to look for protection against equity market moves and firms such as Connective Capital, have seen this in the form of additional allocations to their short biased strategy.
Earlier this month, Connective announced the launch of an offshore version of its 2-year old global short biased equity fund Connective Capital II (CCII). The offshore fund launched with a $5m allocation, no small feat as hedge funds still find the asset-raising environment to be tight. The fund, which returned +89% to investors in 2008, has tracked with its benchmark through 2009 returning -38% YTD. However, performance during recent market setbacks, such as October 2009 (the S&P 500 lost 1.86% while CCII gained 12%) are proving to be strong reminders to investors of the benefits of such a volatility hedge.
The rising wall of fear in the market is driving interest in short strategies, Portfolio Manager Rob Romero told Opalesque. “As the market continu...................... To view our full article Click here
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