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Alternative Market Briefing

Equity market neutral hedge fund strategy with large inflows

Tuesday, May 23, 2017

Komfie Manalo, Opalesque Asia:

Equity market neutral is experiencing large inflows with half of the funds increasing their holdings into Q2, according to ML Capital's Alternative UCITS Barometer for the second quarter of this year.

ML Capital said, "A mere 8% intend to redeem out of this strategy in Q2 and our data has shown the strategy to be favorable across both Q1 and Q2. This has presented a contrast to Morningstar data that witnessed outflows in equity market neutral through Q1, but this differential may be explained by our polled investor base allocating to the growing quant equity market neutral market, rather than fundamental equity market neutral."

ML Capital surveyed a diverse range of 50 investors who collectively manage over $90 billion and today invest upwards of $20bn into Alternative UCITS. Respondents range from insurance and pension funds to private banking organizations, with a significant constituent of wealth managers that deal with the primary source of alternative UCITS inflows, the mid-net-worth investor.

Commenting on the highlights of the latest Barometer, Kenneth Sim, head of sales of ML Capital, "It was a surprising start to the year. We have seen global growth and US equity markets reach new highs, rather than falling markets in the face of political concerns towards Trump's agenda and the European Elections. These rallying markets have suppressed volatility for yet another quarter, with the question hanging as to when it is lik......................

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