Long volatility and tail risk strategies outshone their peers as equities and oil slumped in February

Hedge fund managers were down 1.70 per cent in February as the development of the COVID-19 outbreak outside of Mainland China weighed on risk assets throughout the month, according to Eurekahedge. 

More than 90 per cent of the hedge fund managers were able to outperform the global equity market during the month, exemplifying the downside protection afforded by hedged strategies as opposed to long-only portfolios.

The CBOE Eurekahedge Long Volatility Hedge Fund Index and the CBOE Eurekahedge Tail Risk Hedge Fund Index returned 8.60 per cent and 14.05 per cent respectively in February. The two strategies are known to provide crisis alpha and tail risk protection for institutional portfolios.

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