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Laxman Pai, Opalesque Asia: Hedge funds performed well in 12 months of soaring volatility as returns across the asset class were +16.63% for the year, with the best-performing strategy- equities - delivering +19.64%.
"Taken as a whole, equity strategies delivered a net return of +19.64% last year. This respectable result disguised 12 months of turbulence," said a report from Preqin.
Steep losses in the first quarter were mainly clawed back in the second, while the subsequent six months of the year reinforced more deep-seated confidence returning to equity markets.
According to Preqin, of the different equity-focused strategies, value-oriented took the biggest hit in the first quarter, losing just over 24% in the three months.
It regained most of that ground in the second quarter, with vaccine optimism in November further accelerating recovery into the closing weeks of the year and driving a spike in three-year volatility.
Sector-focused funds were the best performers over 2020 as a whole, reflecting the pandemic-beating characteristics of technology stocks in particular.
Investors and managers are at odds on market outlook
Fund managers and investors have different opinions on how the coming year will play out. "According to our November 2020 survey, 64% of fund managers believe that industry AUM will grow in 2021, while 15% expect no change. But the allocators are in no rush to inject more capital into hedge funds,&...................... To view our full article Click here
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