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By Donald A Steinbrugge (pictured), CFA, Founder and CEO, Agecroft Partners – The hedge fund industry is dynamic, comprising numerous strategies that attract varying degrees of interest over time. Demand for each strategy is impacted by many variables including capital market valuations, expectations of economic growth, market liquidity and risk appetite among others.
Industry professionals spend a great deal of time analysing these variables in order to identify which strategies they believe offer the best opportunities for outperformance. In this paper, we share some data and thoughts on where investors are focusing their time and resources starting with a brief
SURVEY
The global hedge fund industry is successfully weathering the global coronavirus pandemic, with firms continuing to build talent and utilise technology to adapt investor relations and ops functions, according to extensive new industry research by the Alternative Investment Management Association and KPMG.
The report, titled ‘Agile and Resilient: Alternative Investments Embrace The New Reality’, quizzed some 144 hedge fund managers globally, representing around USD840 billion in assets under management.
The wide-ranging study explored how hedge funds’ hiring strategies have been shaped by the coronavirus pandemic, along with how operating models, core processes, cost structures and work environments have been affected.
HEDGEWEEK LIVE EUROPE
Robust, diversified teams that build trust with investors and differentiate themselves from competitors are vital for building long-term success in the hedge fund industry, says Anne-Sophie d’Andlau, co-founder, partner and deputy CEO at Paris- and London-based activist manager CIAM.
NEWS
Brevan Howard, a high-profile global macro hedge fund manager founded by Alan Howard, has strengthened its global business development team with a quartet of appointments in the US, Europe and Asia, with hires from well-known hedge fund firms including Exodus Point Capital Management and Bluecrest.
Natalie Smith has joined in New York as head of strategy, with an investor-focused mandate within directional and relative value macro investing. Smith joins from Commonwealth Asset Management.
Peter Hornick, who was previously at Exodus Point Capital Management and Millennium Management, has been named head of business development for Brevan Howard Alpha Strategies (US) in
COMMODITIES
Some quantitative trend-following hedge funds may be caught in a pincer movement between continued lukewarm performance on one side and ongoing investor aversion as a result of allocators being unable to perform deeper on-site due diligence on the other.
Computer-driven CTAs have posted somewhat patchy performances in recent months after starting the year strongly.
Trend followers were able to gather strong momentum following March’s historic market crash by locking onto a series of sharp moves in commodities and currencies. More recently, though, many hedge funds running these strategies have stumbled in the face of a strong market surge over the
RETURNS
Hedge fund managers running a range of investment strategies rose again last month, with August’s gains capping the strongest five-month run for the industry in more than 20 years.
The HFRI Fund Weighted Composite Index – an investable barometer of the broader hedge fund industry published by Hedge Fund Research – was up 2.67 per cent last month.
In the five months since April, following Q1’s coronavirus meltdown, the index has surged 15.4 per cent – the strongest five-month total return for hedge funds since February 2000. That puts its index value to an all-time high of 15,093.
Year-to-date, the
MANAGER INSIGHTS
William Callanan – a veteran of the investment management industry and a global macro hedge fund specialist, whose resume includes stints at Soros Fund Management and Fortress Investment Group – is capitalising on evolving outsourcing trends with Syzygy Investment Advisory, a novel advisory unit that provides an outsourced chief strategy officer role to an assortment of institutional investors, hedge funds and family office clients.
Launched in April last year, London-based Syzygy’s core focus is on generating alpha across a range of global macroeconomic themes and ideas, investing in currencies, interest rates, commodities and public-traded equities on a long/short and long/only basis.
“We
FUND LAUNCH
Hedge fund specialist Theta Capital Management has launched a new multi-manager fund vehicle for investors to access distressed credit market opportunities. Theta Capital has been waiting for the right time to capitalise on distressed markets and with Covid-19 causing such dislocation in the global economy, the firm feels now is the right time to invest with a select number of distressed managers.
RETURNS
Brummer & Partners, the Stockholm-based multi-strategy hedge fund firm, has seen its flagship vehicle advance further on the back of strong stock market gains in August, with equity, credit and fixed income funds all in positive territory.
The Brummer Multi-Strategy (BMS) fund – which invests in a range of single-strategy hedge funds – made 0.4 per cent last month in its USD and SEK classes, bringing its year-to-date return to 4.2 per cent.
The Brummer Multi-Strategy 2xL twice-levered version meanwhile rose 0.7 per cent in its SEK class and 0.8 per cent in its USD class in August, and is now
MARKETS
Volatility “most definitely on the menu”: Hedge fund industry reacts to Thursday’s shock sell-off
MARKETS
Volatility “most definitely on the menu”: Hedge fund industry reacts to Thursday’s shock sell-off