Funds
Short-selling strategies of all stripes seem set to soar amid the ongoing market mayhem which has seen global equities take a pounding following renewed coronavirus fears.
The S&P 500 was down almost 5 per cent at one point on Monday afternoon, sparked by concerns that the Covid-19 outbreak could become a global pandemic.
European markets meanwhile continued to slide on Tuesday morning, with the FTSE 100 – which closed 3.3 per cent down the previous day – shedding a further 0.83 per cent as investors fled equities for the perceived safety of assets such as gold and US treasuries.
The maelstrom follows
BNY Mellon HedgeMark is a dedicated managed account provider, solely focused on creating and operating managed account platforms for institutional investors. Launched in 2012, the business today has more than USD23 billion in assets across more than 100 funds spanning a broad range of hedge fund strategy types, including long/short equity, macro, equity market neutral, credit, CTAs, risk premia and more.
Large institutions have gradually moved away from off-the-rack, one-size-fits-all products and shifted towards strategies more tailored to their particular investment objectives, says Joshua Kestler, head of the business in New York.
Co-investments are a key area that is gathering momentum,
Innocap, the Montréal-based structuring and operating managed account platform unit co-owned by BNP Paribas and Caisse de dépôt et placement du Québec, was originally established in 1996 as the internal managed accounts-based fund of hedge funds within National Bank of Canada’s Treasury operations. Since then, the Innocap group has grown and now manages approximately USD7.2 billion in assets, structuring and operating customised managed account solutions for institutional investors globally.
As the business has developed, and managed accounts have gained in prominence among hedge fund investors, allocators’ priorities have steadily shifted. Foremost among current trends and developments is risk management,
For all the attendant challenges facing hedge funds – from greater fee pressures and more onerous compliance burdens to lacklustre performance and investor aversion – the industry has time and again demonstrated its ability to continually innovate and reshape the way it does business.
As the balance of power moves decisively away from managers and towards investors, managed accounts have continued to gain traction among allocators who want a greater degree of control, customisation and tailoring in their alternative investments, underpinned by the promise of increased transparency in portfolios and the appeal of lower fees.
As interest in managed account
Several brand name hedge funds are ramping up bets against GVC Holdings, the sports betting and online gaming group home to the likes of Ladbrokes Coral and Foxy Bingo, as the UK gambling sector faces sweeping regulatory changes from April.
Crystal Capital the operator of an alternative investment platforms for financial advisors and their qualified purchaser (QP) investors offering access to hedge fund and private equity investments, has reported 93 per cent growth in new Advisory relationships since January 2019.
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Equity markets have merely sneezed in response to the coronavirus (Covid-19) and while there is uncertainty over how much fear has been priced in, as infection numbers continue to rise, hedge funds have navigated developments with discipline and a modest reduction in net long exposure. For now, rather than trying to react to short-term moves, managers are taking a prosaic stance.
US assets continue to draw international flows, predominantly from Japan, but the level of support may not be sustainable to keep the dollar strong, according to new research by contrarian hedge fund Horseman Capital.
In a note this week, Russell Clark, who leads the long-running London-based global equities hedge fund firm, observed how US Net International Investment Position (NIIP) as a percentage of GDP is now close to 50 per cent of GDP deficit, while private sector deficits in China and Europe are close to zero – implying “almost all flows” from Japan are heading to the US.
Clark –
Lazard Asset Management is launching a new emerging markets quantitative fund which will trade a diversified, low volatility strategy with an ESG focus placed at the forefront of its stock-picking process.
Hedge funds are positioning for a spike in volatility in healthcare, energy, financials and tech as the US presidential election gathers pace.
US-focused long/short equity and event driven managers forecast Donald Trump winning a second mandate in November’s poll, according to research by Lyxor Asset Management.
But with certain Democratic candidates, including Bernie Sanders, promising sweeping changes to the healthcare and banking systems, a ban on fracking, and increases in wealth and corporate taxes, along with higher wages, certain industries – including healthcare, energy, defence, financial, and tech – are more sensitive to the elections.
“Some managers are shaving off
