RMASL: hedge funds favour equity long/short
15 October 2014 Naples, Florida
Image: Shutterstock
Equity long/short strategies will generate good returns for hedge funds in the future, according to a panel at this year’s Risk Management Association Conference on Securities Lending in Naples, Florida.
Panellists Sandy Kaul of Citi, Jon Kinderlerer of Credit Suisse and Michael Litt of Arrowhawk Capital Partners agreed that equity long/short strategies could earn returns of between 5 and 8 percent.
Kaul said that hedge fund are seeing record flows, with equity long/short strategies enjoying a sizable portion. Citi’s prime finance business reported that equity long/short was among the top performing strategies in August, at +1.45 percent.
Kinderlerer echoed the panel’s comments, saying: “Equity long/short is probably a good place to invest.”
An earlier panel reacted negatively to continuing Federal Reserve inaction over interest rates, with Royal Bank of Scotland chief US economist Michelle Girard unable to predict exactly when they may rise.
She said that there is no need for interest rates to remain at “emergency levels” given that the US economy is growing. “The fundamentals don’t justify zero rates,” she explained.
The panel also reviewed political sentiment in the US ahead of mid-term and presidential elections. The current administration and Congress have been at odds over the debt ceiling, which is due to be discussed in the near future.
Brown Brothers Harriman senior vice president Marc Chandler was critical of the US government’s attitude to the economy, saying that in 2015, it will “impede rather than support economic growth”.
Panellists Sandy Kaul of Citi, Jon Kinderlerer of Credit Suisse and Michael Litt of Arrowhawk Capital Partners agreed that equity long/short strategies could earn returns of between 5 and 8 percent.
Kaul said that hedge fund are seeing record flows, with equity long/short strategies enjoying a sizable portion. Citi’s prime finance business reported that equity long/short was among the top performing strategies in August, at +1.45 percent.
Kinderlerer echoed the panel’s comments, saying: “Equity long/short is probably a good place to invest.”
An earlier panel reacted negatively to continuing Federal Reserve inaction over interest rates, with Royal Bank of Scotland chief US economist Michelle Girard unable to predict exactly when they may rise.
She said that there is no need for interest rates to remain at “emergency levels” given that the US economy is growing. “The fundamentals don’t justify zero rates,” she explained.
The panel also reviewed political sentiment in the US ahead of mid-term and presidential elections. The current administration and Congress have been at odds over the debt ceiling, which is due to be discussed in the near future.
Brown Brothers Harriman senior vice president Marc Chandler was critical of the US government’s attitude to the economy, saying that in 2015, it will “impede rather than support economic growth”.
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