Hedge funds started 2018 up 2.20 per cent in January with managers reporting performance-based gains of USD20.3 billion while investor subscriptions stood at USD21.7 billion at the start of the year, according to the February 2018 Eurekahedge Report.
In annual year 2017, final asset flow figures show that manager saw inflows totalling USD114.6 billion while performance-based gains stood at USD107.3 billion over the same period.
The Eurekahedge Billion Dollar Hedge Fund Index returned 1.77 per cent in January; it’s best monthly return since January 2012 which translated into performance-based gains of USD12.8 billion during the month with net inflows of USD12.8 billion recorded. Over the past year, billion dollar hedge funds recorded strong investor interest with net inflows totalling USD66.5 billion while performance-based gains stood at USD53.7 billion.
North American hedge funds registered the strongest growth in AUM among all regional mandates in 2017, growing their asset base by USD136.4 billion over the year. Investor allocations to the region stood at USD13.3 billion as of January 2018, while USD12.8 billion of performance-based gains were recorded. This brings the AUM of North American hedge fund industry to reach a record high of USD1.66 trillion.
Asia ex-Japan hedge funds started the year on a positive note, up 3.72 per cent for the month with underlying Greater China focused funds up 7.82 per cent over the same period while India focused hedge funds were down 0.50 per cent during the month. The Asian hedge fund space expanded by USD24.8 billion in 2017 through a combination of investor flows and performance driven gains.
CTA/managed futures hedge funds posted the best January 2018 returns, gaining 3.54 per cent, with underlying trend-following hedge funds leading much of the strength, up 4.72 per cent over the same period. Underlying commodity-focused managers gained 2.28 per cent while FX-focused peers were down a modest 0.18 per cent. Managers reported performance-based gains of USD6.9 billion during the month, while net investor inflows of USD2.0 billion were recorded.
Among volatility-focused hedge funds, short volatility hedge funds posted the worst performance in January 2018, down 3.30 per cent while tail risk and long volatility hedge funds gained 1.27 per cent and 0.01 per cent over the same period.
The Eurekahedge Crypto-Currency Hedge Fund Index was down 4.55 per cent in January following gains of 1477.85 per cent in 2017 as bitcoin began its tumble.
The Eurekahedge Islamic Fund Index gained 6.19 per cent over 2017, posting its best annual performance since 2013, owing to the global equity market rally and recovering oil price. Malaysia and Saudi Arabia remained as the two prime choices for Islamic funds, accounting for nearly half of the industry population in terms of head office location and domicile.
The USD95.2 billion Islamic fund industry assets grew by nearly 17 per cent over the year, with investor inflows contributing 80 per cent of the total asset growth, indicating stronger investor confidence after two consecutive years of investor redemptions.
