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Business24-7 – Six months after their worst drawdown on record, regional stock markets are outperforming the Middle East and North Africa (Mena)-focused hedge funds, suggesting markets are once again warming up to equity participation.
According to Emirates Business research, Mena markets have posted gains of 9.73 per cent on average, beating the 10 region-focused hedge funds, which have posted returns of 4.4 per cent since the beginning of this year.
Even the GCC markets, battered by their exposure to relatively lower oil prices and global economic environment, have turned in a marginally better performance, at 4.42 per cent, suggesting that risk appetite among investors in the regional markets is on the upswing.
HedgeCo.net (West Palm Beach) – Six months after their worst drawdown on record, hedge funds appear to be demonstrating stronger performance than in some previous recovery periods, such as during the Asian Currency Crisis and the Tech Bubble Burst events.
On average, it has taken hedge funds 13 months to recover from these market disruptions accordind to research peice by Credit Suisse Tremont Index LLC, the research reviews of how hedge funds have repositioned themselves in the first half of 2009 to generate positive returns for five out of the first six months of the year.
The report discusses how hedge funds, as measured by the Credit Suisse/Tremont Hedge Fund Index (“Broad Index”), have generated year-to-date returns of 7.2% through June 30, outperforming, with lower volatility, both key equity and bond indices. Some key takeaways from the report include:
The Convertible Arbitrage, Emerging Markets, and Global Macro sectors have received increased attention as investors began to regain their appetite for risk and global markets rallied.
Performance has improved across most sectors, with the bulk of returns for many strategies moving into positive territory for the year, with 80% of all funds reporting positive returns for the second quarter.
Overall industry assets under management have dropped approximately $18 billion since the end of the first quarter of 2009; we estimate industry assets totaled $1.3 trillion as of June 30 – down from $1.5 trillion at the end of 2008.
As of June 30, 2009, an estimated 9.6% of funds were classified as impaired, meaning they have either suspended redemptions, imposed gate provisions or sidepocketed assets.
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Citywire.co.uk – To analyse all of Europe’s absolute return funds on a variety ofg risk-return measures and see a comprehensive league table of performance visit our new zone here
The CF KB Endeavour Absolute Return fund slipped into negative territory last September as the fallout from the collapse of Lehman Brothers rippled across several major asset classes.
The fund suffered its highest drawdown to date, shedding -16.75%, which effectively wiped out all of the gains it had made since launch in July 2006, and then some.
The Olympian – Asian stock markets turned in a mixed performance Friday, but most recoiled from their lows despite a grim profit forecast from Toyota and sluggish U.S. economic data. European markets opened higher.
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Many of Asia’s bourses showed surprising resilience – notably in Hong Kong, South Korea and Singapore – given the overnight drop on Wall Street, as lower-priced shares attracted buyers and lending markets showed more signs of mending.
Forbes – The hedge fund sector has to date weathered market volitality better than the banking sector, since no large bellwether hedge fund has yet gone bankrupt. Nonetheless, hedge funds are expecting a wave of redemptions, as investors move to safer investments and reconsider their commitments to the sector.
Hedge fund sector resilience? Whereas banking sector difficulties have provoked a host of policy responses, including Treasury Secretary Henry Paulson’s now-moribund $700 billion bailout package–no hedge fund problem has yet necessitated a similar systemic response. The apparent resilience of the sector is particularly striking given that recent estimates suggest that the $2 trillion hedge fund industry accounts for approximately 30% of U.S. equity and bond trades (although volatile market conditions have led many managers to shift greater percentages of their holdings into cash-equivalents).
