Opalesque Industry Update - Emerging markets hedge funds posted industry-leading gains
in 2010, led by funds with regional exposure to Russia and the Middle East, according to Hedge
Fund Research, Inc. (HFR), the leading provider of hedge fund industry data. As a direct result
of these gains, assets invested in emerging market (EM) hedge funds increased by nearly $10
billion in the fourth quarter to end the year at more than $114 billion, approaching the record
level of AUM for EM hedge funds set in 2007. The HFRI Emerging Markets (Total) Index gained +11.79 percent for 2010, topping the gain of +10.30 percent for the HFRI Fund Weighted Composite Index, the leading benchmark of global hedge fund industry performance. EM performance in 2010 follows gains of more than 40 percent in 2009 and is particularly significant considering the EM volatility which characterized 2010. Several regional EM equity markets posted declines for the year and the HFRI EM (Total) Index posted gains in only six of the twelve months in 2010. Middle East-focused funds posted the strongest gains among all EM regions, with the HFRX MENA Index gaining +22.67 percent for 2010. This was followed by the HFRX Russia/Eastern Europe Index, which gained +21.60 percent for the year; the HFRX Multi- Emerging Markets Index, comprised of funds investing globally across several emerging market regions, posted a gain of +17.34 percent.
Fourth quarter EM inflows highest in over 2 years “As the global economic recovery accelerates into 2011, global investors interested in accessing superior growth characteristics will continue allocating to Emerging Markets hedge funds,” said Kenneth J. Heinz, President of Hedge Fund Research, Inc. “EM hedge funds allow investors to access local market expertise via sophisticated strategies and have demonstrated the tactical flexibility to manage through the challenges presented by inflation, liquidity, sovereign debt and currency instability inherent in EM investing.” (press release)
HFR opens China office
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Industry Updates
Emerging markets hedge funds lead industry into 2011
Friday, February 18, 2011
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