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Event driven hedge funds out in front in May

The Lyxor Hedge Fund Index was up 0.84 in May, with six out of 10 Lyxor indices ending the month with a positive performance. The more directional strategies had the best returns.

Event-Driven Strategies led the pack, as they benefited from an acceleration of M&A activity and the completion of large merger deals. Special Situations (+2.5%) outperformed Merger Arbitrage (+1.4%).

Global Macro managers are back in the green thanks to the strengthening US dollar and their fixed income portfolio.

“The performance of Event-Driven strategies picked up in May after having experienced difficult quarters,” says Philippe Ferreira (pictured), senior cross-asset strategist at Lyxor AM. “The strategy recently benefited from the completion of large deals and the tightening of deal spreads. Managers have also adopted a dynamic approach to manage risks, moving away from longer dated soft situations and skewing their portfolio towards hard catalyst M&A situations.”

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