The Lyxor Hedge Fund Index was up 1.1 per cent in September with six out of 10 Lyxor indices in positive territory for the month, according to Lyxor’s latest Alternative Investment Industry Barometer.
Long Term CTAs outperformed due to rates, followed by Variable bias L/S equity funds, in particular US and EM specialists. Global Macro also recovered due to commodities and equities.
“Prospect of ECB normalisation, a firming Eurozone growth, and hopes for reforms coalesced to send EUR above 1.2,’ says Jean-Baptiste Berthon (pictured), Senior Cross-asset Strategist, Lyxor Asset Management. “Draghi did not put his weight to stop it. With a declining sensitivity of the economy and inflation to EUR, it might take a substantially higher EUR to derail the recovery. Yet, Eurozone equities underperformed since the currency takeoff.
“Stocks are actually way more exposed to EUR than the rest of the economy, with about half of their revenues sourced abroad.
“Their top-line growth and high operating leverage should help them overcome the pressure. But we would seek shelter favoring the most domestic countries and sectors.”
