Europe’s hedge fund industry has come along way in 20 years, as our timeline of performance and key headlines demonstrates…
1999
EuroHedge Composite Index annual return: 19.7%
First issue of EuroHedge in January. Total assets in European hedge fund industry stand at $15bn. EuroHedge Composite Index posts median annual gain of 19.7% in 1999, its highest-ever return to date. Egerton Capital is biggest European hedge fund with $1.5bn in AuM. CQS and Aspect Capital launch.
2000
EuroHedge Composite Index: 13% Number of funds: 310
Nasdaq Composite stock market index peaks in March before starting to crash, bringing end to dotcom bubble. Hedge funds substantially outperform stockmarket indices and traditional asset managers in global equity bear market that ensues. Cheyne Capital and BlueCrest launch. Man Group demerges from agricultural commodities business, ED&F Man.
2001
EuroHedge Composite Index: 6.5% Number of funds: 446
Ex-Mercury Asset Management/Merrill Lynch Investment Managers duo Peter Davies and Stuart Roden join Lansdowne to launch UK Equity fund, which becomes Developed Markets flagship. Assets at Marshall Wace Eureka capped at $1.4bn. Firm begins work on system assessing sell-side ideas, which becomes Tops.
2002
EuroHedge Composite Index: 4.2% Number of funds: 578
EuroHedge Awards held for first time in London in January. Inaugural winners include CQS, Gartmore, Tosca, Barclays Global Investors (now BlackRock), Perry, BlueCrest, Rubicon, Threadneedle and Lazard. Brevan Howard launches.
2003
EuroHedge Composite Index: 7.7% Number of funds: 810
Man Group buys 25% stake in BlueCrest for £105m. Perry European manager Chris Hohn quits to start The Children’s Investment Fund. Lazard Asset Management hedge fund business rocked as William von Mueffling leaves to set up Cantillon, raising a record $2.5bn at launch. EuroHedge/Hedge Fund Intelligence acquired by Euromoney Institutional Investor.
2004
EuroHedge Composite Index: 6.3% Number of funds: 1,030
RAB Capital floats on London Stock Exchange’s AIM market, at 25p per share. Inaugural EuroHedge Summit held in Paris in spring. First-year speakers includes Peter Davies, Luke Ellis, Reade Griffith, David Harding and Sushil Wadhwani.
2005
EuroHedge Composite Index: 8.7% Number of funds: 1,258
Marshall Wace co-founder Ian Wace keynotes at second EuroHedge Summit. Hohn’s TCI becomes first manager to win fund of the year in consecutive years, a record which still stands.
2006
EuroHedge Composite Index: 9.7% Number of funds: 1,509
Jabre Capital Partners founded in Geneva and raises $2.5bn at launch, three years after Philippe Jabre received record £750,000 market abuse fine from Financial Services Authority. More than 4,000 industry participants attend Albourne Partners’ Hedgestock hippie-themed ‘conference’ at Knebworth House. Vega’s assets under management plummet from peak of over $11bn in 2005 to low of $1bn following two years of poor performance.
2007
EuroHedge Composite Index: 7.6% Number of funds: 1,617
Hedge Fund Standards Board (initially Hedge Fund Working Group) formed by leading European hedge funds as clouds gather over financial markets and threat of political interference rises. GLG floats on New York Stock Exchange, with Jabre protégé and star emerging markets/macro trader Greg Coffey ringing NYSE opening bell on first day of trading.
2008
EuroHedge Composite Index: -4.8% Number of funds: 1,638
Problems in securitised credit markets escalate into full-blown financial crisis. Lehman Brothers goes bust, global financial system nearly fails. Short-selling bans introduced by regulators. Hedge funds suffer losses but outperform plunging stockmarkets, despite market liquidity crunch and heavy redemptions. Many asset managers impose gates and other withdrawal-limiting measures. Sharp rise in fund closures, notably $3bn Peloton Partners. Madoff fraud uncovered. Coffey quits GLG, joins Louis Bacon’s Moore Capital.
2009
EuroHedge Composite Index: 9.7% Number of funds: 1,309
Tsunami of new regulatory measures aimed at hedge funds in the US and Europe. First draft of EU’s Alternative Investment Fund Managers Directive emerges. G20 calls for increased scrutiny of “systemically important” hedge funds. Markets start to recover from crash. Hedge fund performance rebounds dramatically. Trafalgar’s Lee Robinson moves to Monaco.
2010
EuroHedge Composite Index: 6.0% Number of funds: 1,223
Eurozone crisis erupts. Man Group acquires GLG Partners for $1.6bn as pace of industry consolidation intensifies. Adoption of Ucits onshore hedge fund framework by managers and investors starts to take hold in Europe as ‘liquid alternatives’ appeal to investors’ changing needs. Key Gartmore European equity duo Guillaume Rambourg and Roger Guy quit listed group.
2011
EuroHedge Composite Index: -2.6% Number of funds: 1,158
Global hedge fund performance weakens again with a second negative year after the 2008 industry debacle, fuelling widespread investor disenchantment and frustration. RAB Capital delists from London Stock Exchange, at 10p per share. Henderson buys Gartmore for 92p per share, less than half its IPO price at the end of 2009.
2012
EuroHedge Composite Index: 4.8% Number of funds: 1,084
Ex-Goldman prop trading star Pierre-Henri Flamand’s Edoma Partners shuts down, less than two years after raising $2bn in one of the largest and most feted European hedge fund launches on record. AIMA opens office in New York. Lansdowne co-founder Paul Ruddock knighted for services to arts and philanthropy. Coffey ‘retires’ from Moore Capital and hedge fund industry, at the age of 41.
2013
EuroHedge Composite Index: 8.2% Number of funds: 1,074
Sir Chris Hohn’s The Children’s Investment Fund becomes first fund to win the EuroHedge Fund of the Year award three times. Brevan Howard’s AuM peaks at over $40bn, BlueCrest’s at $37bn. Former GLG co-CEO Manny Roman takes over from Peter Clarke as chief executive of publicly-quoted Man Group. Reputation of CTAs, which soared in 2008, dented as trends dry up.
2014
EuroHedge Composite Index: 3% Number of funds: 1,047
AIMA establishes Alternative Credit Council, underlining growth in private credit and non-bank alternative asset management. Jon Hiscock’s GSA International flagship fund wins EuroHedge Equity Market Neutral & Quantitative Strategies award for fourth time in six years. Brevan Howard co-founder Chris Rokos contests non-compete restriction with old firm.
2015
EuroHedge Composite Index: 3.7% Number of funds: 965
US private equity group KKR acquires 24.9% stake in Marshall Wace (which has subsequently increased to almost 35%) to form long-term strategic partnership. BlueCrest goes private, returns all outside capital to investors. Leda Braga starts Systematica Investments in Geneva after leaving BlueCrest, taking the BlueTrend CTA program with her. Rokos starts Rokos Capital Management.
2016
EuroHedge Composite Index: 2.2% Number of funds: 935
Sir Michael Hintze’s CQS Directional Opportunities wins EuroHedge Fund of the Year award for third time. Cheyne becomes second group to win a third Management Firm of the Year award. Luke Ellis succeeds Manny Roman as CEO of Man Group. Marshall Wace co-founder Paul Marshall knighted for services to education and philanthropy. Brexit referendum divides industry heavyweights.
2017
EuroHedge Composite Index: 5.4% Number of funds: 1,059
Man Group’s assets under management pass $100bn mark for first time. EuroHedge/Hedge Fund Intelligence acquired by Pageant Media, owner of HFMWeek. Greg Coffey prepares for industry return with Kirkoswald Capital Partners in London.
2018
EuroHedge Composite Index: -1.5% Number of funds: 1,147 (at mid-year)
Global hedge fund assets hit all-time high at over $3trn. ExodusPoint leads a resurgence in major new fund launches in the US and Europe. Assets under management at Rokos Capital Management overtake Brevan Howard. Coffey’s plan to move firm from London to New York revealed. Volatility and market routs in February and October trigger heavy hedge fund losses across most strategy areas. Philippe Jabre announces return of capital to investors after losses.
Timeline: 20 years of European hedge funds on EuroHedge.