Hedge Funds Q1 2019 YTD best aggregate returns since start of 2012

Discussion in 'Wall St. News' started by dealmaker, Apr 11, 2019.

  1. dealmaker


    Hedge funds gained an average of +0.87 per cent in March, the third consecutive month of positive returns, following a five-month string of aggregate declines, according to the March eVestment hedge fund performance data.

    The Q1 2019 year to date (YTD) average gains of +5.40 per cent is the industry’s best aggregate returns since the start of 2012.

    Highlighting the volatility frequently associated with emerging markets, India-focused hedge funds were the big winners in March, returning +10.35 per cent, bringing YTD returns into the positive at +5.08 per cent. This is a stark contrast to the -16.23 per cent India-focused funds delivered in 2018. China focused funds are having a strong start to 2019 as well, returning +5.03 per cent in March and +18.65 per cent YTD.

    Among primary strategies, Managed Futures funds produced big gains in March, returning an average of +2.78 per cent, bringing Q1 2019 returns to +2.81 per cent. The group has a long way to go to offset 2018 average losses of -6.02 per cent. The largest funds in the space returned an average of +4.74 per cent in March, but again still must recover a lot of ground to offset 2018’s losses of -7.48 per cent.

    Other big winners in March among primary strategies included Macro funds, which returned +1.56 per cent for the month (+2.44 per cent YTD) and Quantitative Directional Equity funds, which returned +1.28 per cent in March, bringing YTD returns to +4.60 per cent.

    On the other end of the return spectrum, Event Driven – Activist funds took a dive in March, with returns coming in at -2.55 per cent for the month, however their YTD returns are still in the green at +5.48 per cent, a far cry from the -10.36 per cent these funds returned in 2018.

    Among primary markets, Commodities funds were the only funds in the red for March at -0.35 per cent, while YTD returns are still in the green at +2.61 per cent.
  2. What's the point of having the best returns in X years when the hedge funds are still under-performing cheaper stock indices? Why should rich people put money in hedge funds when poor retail investors can put money in low-fees superior performance index funds/ETFs?

    dozu888 likes this.
  3. sle


    Because rich people are smarter (on average, that's why they are rich) and remember that stocks can go down. Hedge funds and private equity are not correlated to the market (supposedly) so there is a diversification benefit to investing there. Similarly, rich people invest in all sorts of alternative assets, from bitcoin to wine. In part, this is due to their natural risk aversion - someone who is well off is going to be more upset to lose 50% of his NW than to gain a 100%.

    Just 10 years ago we had a crisis that posed a severe threat to the global economy and equities were not doing oh so hot. It's pretty incredible how short our collective memory is, all things considered.
    dealmaker likes this.
  4. ElCubano


    Oh how wrong this statement is.
  5. sfwind


    Still underperformed the index...
  6. TommyR


    shut up 0.87%. i dont believe its possible. secrets demanded.
  7. sle


    While it's politically incorrect, it's hard to argue otherwise. Rich people tend to be better educated and better advised. There is, of course, a chicken and egg problem to it - many rich people are born rich (or at least most are not born poor) so they have the benefit of better nurture from very early on.

    There are numerous studies to that effect, here is one for example:
  8. ElCubano


    "The Self Attribution Fallacy". Thanks for the study I'm definitely going to read up on it.
  9. sle


    You are misunderstanding what I am saying. I am not saying that they were not lucky, it's without question that getting rich is mostly attributable to luck (and the more of an outlier your wealth is, the more so). However, being well-educated and of above average intelligence is a necessary but not a sufficient attribute for self-made rich.
    MoreLeverage likes this.
  10. dozu888


    on average, rich people are smarter... there is a correlation.

    however, hedge fund is one of the most stupid thing anyone can invest in.
    #10     Apr 11, 2019