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Reuters – In a period when volatile markets battered most hedge funds, global macro funds are proving their worth, Graham Capital Chairman Kenneth Tropin told Reuters.
During one of the hedge fund industry’s worst years, Graham delivered gains of up to 41 percent in 2008 by making good bets on currencies, stocks, interest rates and commodities. And because the firm invests in highly liquid futures, clients had monthly access to cash even as many funds blocked withdrawals.
The combination of liquidity and returns that are independent of the broader market could revive interest in global macro funds, Tropin said.
"For a long time there was a perception that the biggest returns, the best risk-adjusted returns, were in other strategies. Then we had a market environment last year where most hedge fund styles ended up being correlated to each other and to the equity markets as well," he said.
Graham manages $4.9 billion in assets in human-directed funds and computer-driven quantitative funds. Funds in both categories invest across fixed income, currency, commodity and equity futures.
"Our style of investing offers some benefits, including liquidity and diversification, that may have not been appreciated as much as they should be," he said.
Graham’s quant funds gained from 20 percent to 41 percent last year, while human-directed funds rose by 6 to 27 percent. By comparison, the average hedge fund lost 28 percent.
The Bulletin – Hedge fund managers on average lost 18.7 percent of their clients’ money in 2008, for the worst performance since at least 1990, according to Hedge Fund Research Inc. Combine the losses with investor redemptions, and total hedge fund assets have been cut almost in half. TrimTabs Investment Research and Barclay Hedge Ltd. estimated funds held $1.1 trillion at the end of the year, down from $1.9 trillion a year earlier.
One rare bright spot: the resilience of global macro fund managers, who wager on currencies, equities, interest rates and commodities based on their fundamental analysis of world economic trends.
The Age – Hedge fund managers on average lost 18.7% of their clients’ money in 2008, for the worst performance since at least 1990, according to Hedge Fund Research Inc.
Combine the losses with investor redemptions, and total hedge fund assets have been cut almost in half. TrimTabs Investment Research and Barclay Hedge estimated funds held $US1.1 trillion ($1.7 trillion) at the end of the year, down from $US1.9 trillion a year earlier.
One rare bright spot: the resilience of global macro fund managers, who wager on currencies, equities, interest rates and commodities based on their fundamental analysis of world economic trends.
Chicago Tribune – Government attempts to revive the economy could decide what happens to trading volumes at CME Group Inc.
A $1 trillion federal deficit could flood the market with enough government bonds to stabilize volumes, while a Federal Reserve policy to spur borrowing by keeping interest rates near zero could slice further into volumes at the Chicago-based exchange operator.
U.S. Treasury bonds and other interest rate futures represent about 40 percent of the 7.63 million contracts traded daily this month at the CME Group’s Chicago Mercantile Exchange and Chicago Board of Trade.
