The Eurekahedge Hedge Fund Index ended September down 0.05 per cent, trailing behind the MSCI AC World Index (Local) which gained 0.07 per cent over the course of the month.
North American hedge fund managers broke their winning streak and slumped 0.16 per cent, contrary to the positive performance exhibited by the S&P 500, which ended the third quarter with its best performance since Q4 2013. On a year-to-date basis, North American fund managers maintained their lead over other regional mandates with a 3.16 per cent return.
Over in Asia, concerns over the escalation of the tariff spat between China and the US has continuously put pressure on the region’s equity markets throughout the quarter with the PBOC recently reducing the reserve requirements for its banking system for the 4th time this year to cushion the impact of US tariffs on the country’s economy.
Asia ex-Japan hedge fund managers lost 1.80 per cent in September, barely ahead of the benchmark MSCI AC Asia Pacific ex-Japan Index (Local) which declined 1.87 per cent over the month.
Escalating trade tensions, weak currencies, and slowing growth in China might continue to pose as challenges for hedge fund managers focussing in the region for the remaining months of 2018. Across major strategic mandates, distressed debt and fixed income led the pack with their 1.84 per cent and 0.72 per cent returns over September.
Roughly 48.7 per cent of the underlying constituents of the Eurekahedge Hedge Fund Index ended the month on a positive note, with 10.4 per cent of these managers posting double-digit gains year-to-date. The asset-weighted Mizuho-Eurekahedge Index (USD) edged 0.55 per cent higher during the month, supported by the strong performance of fund managers overseeing large assets during the month. The Eurekahedge Billion Dollar Hedge Fund Index is up 0.97 per cent for the month, and 0.50 per cent for the year through to September.