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5yrs ago Hedge Fund hfm.global Views: 497

Global hedge fund performance is set to be flat in September. The HFM Global Index composite is on course for a marginal drop of 0.07% for the month. Asian funds outperformed their peers posting a 0.26% return. American managers were also slightly up climbing 0.10%. The biggest detractor was European managers who slipped 0.53%.

September caps a weak third quarter for global hedge funds. Both Asia and Europe-based managers, along with UCITs and FOHFs, are all set to finish Q3 flat. Only U.S. based managers managed to carve out a meaningful return, the Absolute Return 3-month composite is set to climb 1.22%.

Americas Indices

Americas-based fund managers posted mixed returns. Commodities funds are up 3.56% for the month, more than double the 2017 full-year return of 1.76%. If that figure holds it would be the biggest monthly gain since June 2008 when investors piled money into commodities, during the financial crash, pushing prices up. Our sister publication, HFMWeek, has recently reported on a flurry of commodity funds that are gearing up for launch including  Merritt Point, Imbue Capital and Statar Capital. The Bloomberg Commodity Index was up 1.92% for the month.

U.S.-based global equity and fixed income managers are also set to contribute positively gaining 0.93% and 0.77%, respectively.

After five months of positive performance, funds focused on U.S. equity are down 0.88% leaving the year-to-date figure at 4.50%. This is marginally ahead of global equity managers who have returned 4.45% over the same period. The MSCI World index has climbed 5.44% and the S&P 500 10.57% through September.

Other detractors are the event-driven category, which is down 0.75%, and managed futures funds who are forecast to lose 0.53%.

Q3 Equity Performance Breakdown

The table reveals that tech-focused funds have outperformed global equity, U.S. equity and the global benchmarks in the third quarter over the past five years. When global equities fell off a cliff in Q3 2015, tech- focused funds lost less than half as much as their global equity and U.S. equity counterparts.  Moreover, technology funds lost 459 basis points less than the S&P 500 during the slowdown.

Over the five Q3 periods U.S. based global equity fund managers have lagged the MSCI World index by 120 basis points. However, this is much less than U.S. based domestic equity managers who have under-performed the S&P 500 during the period by 837 basis points, over six times more.

Definitions

HFM Global Indices
The HFM Global Indices currently tracks 8,097 funds from 3,621 firms. Our monthly indices estimates are based on fund returns that have been submitted at the time of publishing. Final month-end composite performance can vary substantially from the early month estimates.

MSCI World Index
The MSCI World Index is a broad global equity index that represents large and mid-cap equity performance across 23 developed markets countries. It covers approximately 85% of the free float-adjusted market capitalization in each country

MSCI Europe Index
The MSCI Europe Index represents the performance of large and mid-cap equities across 15 developed countries in Europe.

MSCI Pacific Free Index
The MSCI Pacific Index captures large and mid cap representation across 5 Developed Markets (DM) countries in the Pacific region. The index covers approximately 85% of the free float-adjusted market capitalization in each country.

Dow Jones Industrial Average
The Dow Jones Industrial Average is a price-weighted measure of 30 U.S. blue-chip companies. The index covers all industries except transportation and utilities.

S&P 500 (TR)
The Standard & Poor’s 500 Index – S&P 500 is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies by market value.

NASDAQ composite
The Nasdaq Composite Index is the market capitalization-weighted index of over 3,300 common equities listed on the Nasdaq stock exchange.

Indices: Global hedge fund managers struggle to make money in September on Absolute Return.


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