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In the week ending 28 August, 2015, a study by Monash University in Australia showed that most hedge fund managers are passive, not active. Active management should be manifest through nonlinear exposure to the systematic risk factors that drive hedge fund returns. In order to demonstrate managerial skill, enhanced performance should accrue as a consequence of active management. Using generalized additive models, Monash finds that approximately two-thirds of hedge funds exhibit only linear factor exposures and hence are “passive”. What’s more, such “passive” managers tend to outperform “active” managers. Finally, the study also shows that many “active” managers, despite initial nonlinear risk exposures, eventually become “passive”.

eVestment said that that total hedge fund assets increased 0.35% in July 2015 to reach $3.133tln; Preqin said that hedge funds attracted $76bn in the first half of 2015, bringing industry AuM according to their count to $3.22tln; Blue Sky Alternatives has brought forward its growth targets by 12 months to $2bn by December 2016; and the liquid alternative fund MainStay Marketfield saw its assets shrink to $4.4bn from $21.5bn in 18 months.

Hatteras Funds has launched the Market Neutral Fund (HMNAX), which is ......................

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