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Hedge fund returns YTD are weakest since 2011

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Hedge funds are up 0.45 per cent for the year, their weakest performance on record since 2011 when they declined 0.40 per cent in the eight months through to August, according to the September 2018 Eurekahedge Report.

Almost 46 per cent of the managers are in the green for the year with roughly 12 per cent of these managers posting double digit gains as tracked in the Eurekahedge Global Hedge Funds Database.
Total assets under management have increased by USD7.4 billion as of August 2018 year-to-date, down from USD147.4 billion over the same period last year as performance driven losses and subdued allocations from investors cap asset growth. Barring January earlier this year, investors have redeemed USD25.4 billion from hedge funds globally through to August.
Emerging markets focused mandates are in the red for the year down 3.05 per cent year-to-date, with Asian managers down 2.26 per cent for the year and underlying Eurekahedge Greater China Hedge Fund Index posting losses of 5.94 per cent as of August 2018.
Across strategies, distressed debt, relative value and event driven hedge funds lead for the year up 7.46 per cent, 3.79 per cent and 1.70 per cent respectively.
Assets under management for CTAs/managed futures strategies have shrunk by almost 11 per cent in 2018 – corresponding to a decline in AUM of USD29.0 billion in the first eight months of the year. The strategy however posted gains of 1.05 per cent in August, with underlying trend following strategies up 2.64 per cent for the month.
Across both equities and fixed income assets, North American hedge fund managers remain the bright spot with underlying long/short equity managers up 5.65 per cent whilst fixed income focused mandates have gained 5.35 per cent as of August 2018 YTD. In contrast, emerging markets focused equity long/short managers are down 4.92 per cent while fixed income mandates have lost 3.34 per cent for the year.
The Eurekahedge Crypto-Currency Hedge Fund Index is down 52.93 per cent for the year. The index has lost more than half of its value over the first eight months of 2018, as fund managers struggled to mitigate the damage caused by the crypto-currency market crash following gains of 1708.5 per cent in 2017.

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