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FUND PERFORMANCE
Vaccine optimism and hopes of an end to coronavirus quarantines and lockdowns are spurring growth among emerging markets-focused hedge fund managers, new industry analysis shows.
Hedge Fund Research said on Friday that an upsurge in both performance and capital over the past year have positioned emerging markets managers – and, in particular, those focused on China – for a “strong continuation” of gains in 2021.
EM hedge funds – as measured by HFR’s Emerging Markets (Total) Index – gained 12.7 per cent in 2020. China-focused strategies powered the advance, with the Emerging Markets China Index soaring more than 26.3 percent
FUND FLOWS
Three months of hedge fund inflows came to an abrupt halt at the end of the third quarter, as investors withdrew USD2.8 billion in September amid a surge in coronavirus cases and fears of renewed economic disruption, new data from BarclayHedge shows.
Despite September’s outflows – which represent 0.1 per cent of industry assets – as well as a trading loss of USD15.6 billion, global hedge fund assets grew to USD3.38 trillion at the end of September, up from USD3.36 trillion the previous month.
BarclayHedge’s data analysis of some 6,900 funds showed sector-specific hedge funds led the way, drawing USD2.3 billion
DIGITAL ASSETS
By A Paris – Some say you should never resist the unfamiliar, but until recently, the institutional investor market has staunchly resisted considering cryptocurrencies and digital assets to be an asset class of their own. But as large institutions like insurer Mass Mutual investing in Bitcoin and asset management behemoth, BlackRock filed for two of its funds to invest in the crypto asset, the outlook for digital investments to be classed as an asset class in and of themselves is looking more positive.
A research paper by academic Asheer Jaywant Ram concludes: “Bitcoin represents a distinct alternative investment and asset class. There
FUND FLOWS
Hedge funds attracted USD6.39 billion of new capital last month as investors piled into a wide variety of strategy types, particularly macro and managed futures, according to new industry data from eVestment.
Managers running macro and managed futures strategies were the big winners in terms of allocator appetite in January, eVestment said on Thursday, as long/short equity funds lost money – a shift which could hint at potential investor concerns over the state of equity and credit markets in early 2021.
January’s positive inflows to the industry follows three consecutive years of annual outflows, during which time around USD200 billion exited
NEWS
Pictet Asset Management, the investment management arm of the Geneva-headquartered wealth management giant Pictet Group, is opening a Shanghai office under China’s wholly foreign-owned enterprise (WFOE) rules, allowing it to further capitalise on growing investor demand there.
Pictet AM has registered its Shanghai WFOE with the Asset Management Association of China (AMAC), enabling the firm to raise funds from domestic mainland investors to invest in its offshore strategies under the Qualified Domestic Limited Partners (QDLP) programme.
The move – which follows WFOE launches by several high-profile hedge fund firms in recent years – builds on Pictet AM’s existing China strategy.
SURVEY
Hedge funds could be set for a rush of new capital pouring into the industry this year – potentially reaching up to USD30 billion – as investor appetite grows following strong 2020 performances, Barclays said on Wednesday.
The bank’s ‘2021 Global Hedge Fund Industry Outlook and Trends’ report found that allocator sentiment towards hedge funds is the strongest it’s been since 2014, with 41 per cent of all investors planning to increase their hedge fund exposure this year.
The annual hedge fund investor survey quizzed 240 firms representing USD5 trillion in assets, including USD725 billion of hedge fund investments –
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RETURNS
The strong market moves sparked off by the recent coronavirus vaccine breakthrough brought gains and losses across the hedge fund spectrum over the past week, as investors fled momentum-based stocks and piled into value-based companies.
NEWS
Three former Highland Capital Management partners have launched Sycamore Tree Capital Partners, a new alpha-focused private and alternative credit investment manager which aims to tap into value-oriented opportunities arising from credit market upheaval.
The Dallas-headquartered firm is co-founded by alt-credit veterans Mark Okada, who will serve as CEO; Jack Yang, the firm’s president and head of business development; and chief investment officer Trey Parker.
Sycamore Tree, which also has an office in New York, will initially focus on traded credit, structured products and special situations, drawing on the trio’s “deep experience across multiple cycles”.
The trio said credit has become
COMMENT
“Cause for concern”: Man Group sounds warning on risk appetite and positioning
COMMENT
“Cause for concern”: Man Group sounds warning on risk appetite and positioning