eVestment: performance woes for hedge funds
10 January 2019 London
Image: Shutterstock
The global hedge fund industry ended a volatile 2018 in the red, making it the industry’s fifth consecutive month of negative performance, according to eVestment.
The analytics firm found aggregate performance for December stood at -2.15 percent and for the year at -4.86 percent.
eVestment noted the volatility in its latest eVestment hedge fund performance data.
The industry’s aggregate negative performance for last year was nearly on par with the industry’s second-worst year on record, 2011, when returns came in at -4.99 percent.
The hedge fund industry’s worst annual performance on record came in at -15.75 percent back in 2008.
eVestment said: “The 2018 performance is in stark contrast to the industry’s strong aggregate performance of 8.93 percent in 2017 and almost universally positive performance among hedge fund markets, strategies and geographies in 2017.”
Commenting on the results, Peter Laurelli, eVestment’s global head of research, said: “The story in 2018 was very fund-specific, with some funds performing very well, while other funds faltered.”
He added: “This highlights the importance of doing deep research and due diligence in the hedge fund selection process.”
Despite the aggregate negativity, “there were pockets of good relative returns”, eVestment found.
Origination and financing hedge funds were the big winners in returns in 2018, with performance of 3.94 percent.
Long/short equity and activist strategies were hurt most by year-end market declines.
Activist funds ended 2018 at -13.35 percent, suffering the industry’s most significant losses outside of emerging markets. Long/short equity funds ended 2018 at -6.85 percent.
India and China-focused products posted the most considerable aggregate losses for the year of all segments, coming in at -17.04 percent and -16.84 percent, respectively.
The analytics firm found aggregate performance for December stood at -2.15 percent and for the year at -4.86 percent.
eVestment noted the volatility in its latest eVestment hedge fund performance data.
The industry’s aggregate negative performance for last year was nearly on par with the industry’s second-worst year on record, 2011, when returns came in at -4.99 percent.
The hedge fund industry’s worst annual performance on record came in at -15.75 percent back in 2008.
eVestment said: “The 2018 performance is in stark contrast to the industry’s strong aggregate performance of 8.93 percent in 2017 and almost universally positive performance among hedge fund markets, strategies and geographies in 2017.”
Commenting on the results, Peter Laurelli, eVestment’s global head of research, said: “The story in 2018 was very fund-specific, with some funds performing very well, while other funds faltered.”
He added: “This highlights the importance of doing deep research and due diligence in the hedge fund selection process.”
Despite the aggregate negativity, “there were pockets of good relative returns”, eVestment found.
Origination and financing hedge funds were the big winners in returns in 2018, with performance of 3.94 percent.
Long/short equity and activist strategies were hurt most by year-end market declines.
Activist funds ended 2018 at -13.35 percent, suffering the industry’s most significant losses outside of emerging markets. Long/short equity funds ended 2018 at -6.85 percent.
India and China-focused products posted the most considerable aggregate losses for the year of all segments, coming in at -17.04 percent and -16.84 percent, respectively.
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