Hedge funds continued to rebound with even better weighted average returns in the first quarter of this year than Q4 2022, with Multi-Strategy and Equities funds continuing as the top performers, according to a data released by Citco.
Data from the fund administrator, which has over $1.8 trillion in assets under administration (AUA), saw an overall weighted average return of 4.49% in the first quarter of this year – up from 4.11% in Q4.
All fund strategies delivered positive returns with the exception of Commodities at -2.2% and Global Macro at -1.14%. Multi-Strategy and Equities funds bettered their Q4 performance with Q1 weighted average returns of 5.78% and 5.42% respectively.
All AUA categories generated positive weighted average returns, with larger funds significantly out-performing their smaller counterparts. Funds with more than $3B of AUA saw a weighted average return of 6.43% in Q1, by far the best-performing size category; in contrast, the smaller categories of $200-500M and under $200M had weighted average returns of 2.28% and 0.83% respectively.
Capital flows were once again negative, with net redemptions from Citco administered funds totalling $4.8 billion. However, this was lower than the net redemptions seen in Q3 and Q4 of $9 billion and $8.9 billion respectively. Hybrid funds were again the winners in Q1 in terms of investor flows, with $1.4 billion of net inflows overall – the only strategy type to experience net inflows for the quarter. Across AUA buckets, all categories saw net outflows; funds between $5 billion-$10 billion were the exception, seeing minor net inflows of $300 million.