By Mario Acquistapace (pictured), Associate - Investment Research, Capital Generation Partners – As allocators we have, in part, a responsibility for the actions and inactions of the managers we select. When it comes to responsible investing there is certainly very little consensus on the right approach, and ultimately investors tend not share identical views of what is or is not an appropriate SRI investment policy to adopt.
The collapse of Archegos Capital Management, which is set to bring hefty losses to a number of exposed investment banks, has again thrown the spotlight onto outsized leverage held by hedge funds and investment managers, and raises renewed fears over excessive liquidity across markets.
Aberdeen Standard Investments is bullish on event driven merger arbitrage hedge funds amid a surge in deal volumes, while equity long/short and activist managers are also tipped to capitalise on the continued fallout from the coronavirus pandemic.
Key considerations for hedge fund succession planning – Part II: Leadership transition involves a maze of complexity
By Joel Press, Press Management – The transition of leadership in the private world of hedge funds is incomparable to corporate America, requiring both a deft touch and significant forward planning. The founders of successful hedge funds will have invested years, often decades, building the business in their image. When it comes time to handing over the keys to someone else, it can be a hugely emotional affair so picking the right leadership has to be approached very carefully.
Inflation is the next big risk facing the nascent economic recovery, and equity investors should be “exceptionally selective” in their exposures, tilting portfolios towards market neutral strategies that will help avoid excessive beta risk, says Man Group’s Pierre-Henri Flamand.
By Stephen Oxley (pictured), managing director, Institutional Relationship Group, PGIM – I read a prediction in one of those crystal-ball gazing missives that financial firms like to put out at the start of every year. It forecast that there will be continued blurring between hedge funds and private equity. I must admit I baulk at such an idea and find myself asking whether the convergence of liquid and illiquid alternatives is a desirable end and, if so, whose interests might best be served by an erosion of the distinction.
The increasing democratisation of stock trading – and the growing impact of social media in market movements – is likely here to stay following last month’s GameStop frenzy, which could bring sweeping changes to the way hedge funds build short positions amid volatility surges.
Japan’s macroeconomic backdrop is strengthening alpha-generating opportunities for hedge funds, with a growing number of newly-launched Japanese equity strategies looking to capitalise on a kaleidoscopic range of stockpicking ideas arising from market-friendly structural reforms, a pick-up in economic momentum, improving fundamentals, and a falling number of coronavirus cases.
As dust settles on GameStop carnage, hedge funds ponder lasting impact of ‘Reddit raid’ on short selling
The co-ordinated billion-dollar raid on hedge funds’ short positions in GameStop by amateur traders represents another risk management factor in a battalion of emerging challenges that now confront managers’ portfolios, industry participants say.
“Hedge funds are back”: Veteran investor Dixon Boardman sees “compelling opportunities” across three key strategy areas
Seasoned hedge fund investor Dixon Boardman (pictured), the founder and CEO of New York-based multi-manager group Optima Asset Management, is bullish on hedge funds for the year ahead – seeing compelling opportunities across several strategies after a year in which strong outperformance by many hedge funds has put alternatives firmly back on the radar of allocators around the world.