Australian based absolute return and hedge funds continued their outperformance during May, returning an average of 2.55 per cent across all strategies, according to Australian Fund Mon
Australian based absolute return and hedge funds continued their outperformance during May, returning an average of 2.55 per cent across all strategies, according to Australian Fund Monitors.
This was the third consecutive month of positive returns, bringing 2009 year-to-date returns to +5.91 per cent, and 12 month performance to -10.91 per cent.
Performance across broad asset classes was reasonably consistent for the month with equity based funds returning 2.53 per cent versus non-equity funds’ return of 2.58 per cent.
Fund of funds were up higher than might be expected, at 2.59 per cent, however only 38 per cent of these have as yet reported.
Against the ASX200, the outperformance continues over both the month (+1.70 per cent), year-to-date (+3.33 per cent), 12 months (+21.69 per cent) and since January 2004 (+38.46 per cent).
Australian Fund Monitors says the one month outperformance of +1.56 per cent is interesting because historically hedge funds have underperformed in rising markets due to their defensive nature.
The ASX200 gave up almost 100 per cent of the gains made between January 2004 and late 2007 and is now still only 16 per cent above the level of 2004. As such it needs to rise over 70 per cent from its lows of March 2009 to recover its November 2007 peak.
Absolute return and hedge funds by contrast rose 80 per cent over the period January 2004 to November 2007, before falling, but still retained gains of 45 per cent when at the lows of March 2009, and as at the end of May are up a cumulative 55 per cent since January 2004.
Almost 83 per cent of funds provided positive returns in May, and over 70 per cent have been positive YTD. This is a sharp improvement on the 12 month and 2008 figures of 29 per cent and 25 per cent respectively.
