Preqin: Hedge funds stumble again
22 October 2018 London
Image: Shutterstock
Hedge funds stumbled again in the Q3 2018 with a return of 0.64 percent, revealing a drop from the previous quarter’s results, according to the latest quarterly hedge fund report by Preqin.
Preqin said the return across hedge funds is stark when considered in contrast to the strong performance in public markets, particularly in US equities, off the back of robust economic growth and earnings data in the US over the quarter,
The number of funds pursuing opportunities in Asia-Pacific has also grown significantly in Q3 2018, as managers see more opportunities emerging from the region, Preqin found.
Looking forward, Q4 could prove pivotal for hedge funds, it suggested.
Amy Bensted, head of hedge funds at Preqin, said: “Looking beyond returns we have noted several changes in trends across the hedge fund universe over Q3 2018. The number of hedge funds coming to market is at its highest since Q2 2017.”
“In particular, we have seen a big spike in the proportion of equity strategies launched over the quarter, despite the lag between wider equity markets, perhaps as fund managers
eye opportunity in the growing concerns around a market correction.”
“The spike in US bond yields and the trade war between the US and China has already spooked markets in October, with many equity markets suffering their worst losses since the market shock in February.”
She concluded: “Brexit talks look more precarious than ever, and the US mid-terms and Brazil elections are among other political and monetary policy changes and negotiations that will be impacting markets over the last three months of the year.”
Preqin said the return across hedge funds is stark when considered in contrast to the strong performance in public markets, particularly in US equities, off the back of robust economic growth and earnings data in the US over the quarter,
The number of funds pursuing opportunities in Asia-Pacific has also grown significantly in Q3 2018, as managers see more opportunities emerging from the region, Preqin found.
Looking forward, Q4 could prove pivotal for hedge funds, it suggested.
Amy Bensted, head of hedge funds at Preqin, said: “Looking beyond returns we have noted several changes in trends across the hedge fund universe over Q3 2018. The number of hedge funds coming to market is at its highest since Q2 2017.”
“In particular, we have seen a big spike in the proportion of equity strategies launched over the quarter, despite the lag between wider equity markets, perhaps as fund managers
eye opportunity in the growing concerns around a market correction.”
“The spike in US bond yields and the trade war between the US and China has already spooked markets in October, with many equity markets suffering their worst losses since the market shock in February.”
She concluded: “Brexit talks look more precarious than ever, and the US mid-terms and Brazil elections are among other political and monetary policy changes and negotiations that will be impacting markets over the last three months of the year.”
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