Up arrow

Hedge funds positive again in June, says eVestment

Hedge fund performance was positive in June for the second consecutive month, according to the latest eVestlment monthly summary report.

June also marked the third month of positive returns in the first six months of 2014.
 
The industry returned 1.14 per cent in June, 1.89 per cent in Q2 and ended the first half up 3.08 per cent, on pace for an annualised return of 6.26 per cent for the year, lagging 2013 and 2012.
 
Activist hedge funds posted large gains in June, an average of 3.51 per cent, making the group the best performing strategy in both Q2 and H1 2014. Event driven funds are on pace to return over 12 per cent for a second straight year.
 
Distressed funds had another solid month in June, returning 1.07 per cent, putting the group’s 2014 returns ahead of all other major strategies, except activists.
 
Funds reporting exposure level data to eVestment showed an increase in median and average short exposure in the last two months. Prior to the increase, short exposure had been in decline since late 2011.
 
After falling sharply post-Euro sovereign crisis in mid- 2011, average long exposure had steadily risen up until a peak in mid-2013. Since then, average long exposure had declined along with short exposure. The last time both long and short exposures experienced a prolonged month over month reduction was August – November 2008.
 
Credit funds posted their tenth consecutive positive month in June, returning 0.69 per cent, and are the second best performing primary market-focus behind volatility strategies. The continued decline in longer-term UST yields continues to be a positive for the universe, which is on pace to outperform 2013 gains.
 
Options/volatility strategies appeared well positioned to take advantage of the low-volatility environment in the first half of 2014. The group’s H1 returns of 5.63 per cent are already ahead of full year 2013 gains and are best of any major market exposure.
 
Long/short equity strategies were positive in June and Q2, but the group is well below 2013’s pace and is lagging the S&P by more than half. While there have been pockets of strong gains from the group, most notably from energy sector funds, on an aggregate basis returns have been muted.
 
Macro and managed futures strategies posted their second and third consecutive positive month in June, respectively, each ending Q2 in positive territory.
 
Emerging markets were generally strong in June again led by exposure to Russia and India. Conflict and major events were not positive for all EM exposures as funds focused on the Middle East/Africa experienced their first major decline in just over a year.

Further reading



Upcoming events

4 weeks 6 days from now - Hong Kong
4 weeks 6 days from now - Ulaanbaatar
5 weeks 5 hours from now - Dublin
5 weeks 5 days from now - California
5 weeks 5 days from now - California

Upcoming training

Sun, 24/08/2014 (All day) - Dubai
Wed, 10/09/2014 (All day) - London
Mon, 29/09/2014 (All day) - London