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FUND PERFORMANCE
Hedge funds are well-placed to outperform other assets classes in a potentially choppy market environment during the fourth quarter, with commodities, event driven and certain credit strategies faced with a rich opportunity set and strong upside potential as markets adjust to a post-Covid world.
In its latest ‘Fourth-Quarter Hedge-Fund Strategy Outlook’, K2 Advisors said global equities and bond markets are now locked in a “tug-of-war” between good news and bad news, which is shaping the way investors position their portfolios.
“Change creates opportunities for those nimble enough to capture the new tailwinds while hedging out the risks associated with a
PARTNER FEATURE
As any start-up founder knows, launching a new business can be an exhausting and all-consuming experience. When not dealing with day-to-day operations or handling accounts, there are investors to deal with and venture funding to be raised, often from multiple backers with competing agendas.
PARTNER FEATURE
As more alternative fund managers explore the yield opportunities in private debt, one of the risks is introducing too much complexity to their middle- and back-office operations. Outdated accounting and portfolio management systems or insufficient internal resources for tracking individual loan performance increase that risk.
ALLOCATION TRENDS
The recent steady flow of new investor capital into hedge funds this year could be showing signs of slowing down, with less than half of managers (44 per cent) seeing positive inflows in September, according to new eVestment research.
Overall, investors yanked USD7.99 billion out of the global hedge fund industry during September, according to eVestment’s latest ‘Hedge Fund Asset Flows Report’. Coupled with a performance slide of 0.57 per cent for the month, hedge funds’ overall assets dipped from USD3.62 trillion in August to USD3.59 trillion in September, eVestment’s metrics show.
“That quarter-end data would show outflows is not
GUEST ARTICLE
By Andrew Beer (pictured), founder and managing member of Dynamic Beta Investments – Almost overnight, allocators started to swap out fixed income exposure for hedge funds. What’s driving this? Two trends: after large and sudden drawdowns in both 2020 and 2021, many allocators simply want out of traditional fixed income; meanwhile, with alpha back, hedge funds appear to have much better return potential with comparable or lower risk.
Let’s start with the first trend. The difficult reality today is that fixed income investors face paltry expected returns with potentially big downside risk.
Take AGG, an ETF that tracks the Barclays
FUND PERFORMANCE
Total hedge fund industry assets have swelled to almost USD4 trillion globally, a rise of nearly USD370 billion since the start of this year, according to new capital flows data.
GUEST ARTICLE
Hedge fund managers looking to attract allocations from institutional allocators will need to take several proactive steps – including increasing their levels of disclosures and education – if they are going to build trust among prospective investors.
ALLOCATION TRENDS
US investment consultant, Meketa Investment Group, is looking for hedge fund risk mitigation and diversification strategies, as it looks to de-risk client exposure to directional equities.
HEDGE FUNDS
Massar Capital Management has launched a new discretionary macro hedge fund strategy which aims to capitalise on directional trading opportunities across a broad set of global markets.
ACTIVIST INVESTING
Sir Christopher Hohn’s TCI Fund Management has set out a strategic plan to overhaul Canadian National Railway which it says would put the Montreal-headquartered freight railway company “back on track.”
The London-based activist hedge fund this week outlined sweeping proposals for a “high-quality, experienced board, a world-class railroader as CEO and a long-term plan for sustainable growth.”
The plan also includes several board changes and a new CEO, four immediate key priorities, and a six-point plan for sustainable long-term growth.
In Monday’s announcement, TCI said CN’s current board had been responsible for “multiple corporate governance failures”, which has led to
