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According to RBC, the most profitable hedge fund strategy during September was managed futures, recording a positive 4.38%.
Futures and CTA managers had been bolstered by currency linked trades as the US Dollar depreciated against other currencies. This followed the 50 basis point cut by the Fed on September 18th.
During September, the S&P 500 and MSCI World Index gained 3.6% and 4.6% respectively. Therefore in broad terms, thereÆs still the evidence that hedge fund returns are far from decoupled from benchmarks and the rest of the investment management market and the parallels remain direct.
Nevertheless, not all indices are constituted in the same way, and EurekahedgeÆs hedge fund index recorded an average gain of 3.6%, double that shown by RBC. This return compared to a 1.8 % fall in their index during August.
For the Asian-specific indices, EurekahedgeÆs Japan index was up by 1.8%. The Asian index rose by 4.67%, compared to a 1.95% fall in August. That attests to the new records set by China-related stocks set during the month.
For specific strategies, Eurekahedge also found that managed futures and CTAs led the way, with a 5.06% advance. Coming up the rear were Event Driven strategies with a 0.97% profit. The narrowing of deal premia continued to persist for that hedge fund strategy, as uncertainties about deals closing drifts on.
ôSeptember was a sharp rebound for us, recouping all of the August downdraft and then some,ö says Mark Reinisch, director of fund of funds FRM. FRM had been down 1.77% in August, even though it had been strongly up in July, producing a net decline of just 10 basis points for those two months combined. Reinisch adds. ôDeep-value type equity long-shorts that had held, and been hit, in August were paid well for their patience in September. Credit long/short managers and distressed managers also had a strong month, belying the media's focus only on credit woes.ö
Investors still favour private equity assets for their higher growth, better governance structures, and diversification potential.
The recent focus on greenwashing has put bond issues under greater scrutiny. However, some market participants believe this risks paralysis by analysis.
The AU$85 billion ($61.6 billion) Australian super fund has some exposure to indebted property developer Evergrande. Meanwhile, China’s construction finance is part of its core strategy in real estate.
Investors are seeing the risks, but also the opportunities of the logistics sector. Warehousing their fears for the moment, they can see it's a good conduit to high-growth assets.