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Hedge funds end Q3 2013 on pace to beat 2012 returns, says eVestment

Hedge funds rose an average of 1.7 per cent in September, ending the third quarter up 2.4 per cent, and have returned an average of 5.7 per cent through the first nine months of 2013, according to eVestment’s September hedge fund performance report.

 

On an annualised basis the industry is on pace to return 7.7 per cent in 2013, slightly ahead of 2012’s 7.2 per cent increase.

 

Long/short equity is on pace for their best year since 2009 and second best since 2006. In both those prior years the universe beat the S&P 500.

 

Performance in September and Q3 was dragged down once again by managed futures, FX and commodity strategies. With systematic strategies removed (the majority of these universes are systematic), the hedge fund industry would be on pace to exceed 11 per cent in 2013.

 

Credit strategies performed well in the month, but are struggling to post returns even half of the level of 2012. MBS funds are on pace for their worst year since the financial crisis, albeit +5.9 per cent for the year.

 

Macro strategies were well positioned to benefit from rising treasury prices in September, however the higher level of volatility from large macro strategies since May highlights the subset’s exposure to rate markets.

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