Hedge Funds are Posting Solid Performance
Hedge funds have posted a solid performance for the second week in a row, lifting the Lyxor Hedge Fund Index (HFI) closer to new highs.
The index was up 0.6 per cent last week, bringing the year-to-date performance to +1.5 per cent.
All
strategies benefited from the market rally, which saw the S&P 500
reaching 2000 and the 10y Bund yield falling below one per cent for the
first time on record.
The
dovish tone of central banks remains supportive for both equities and
bonds. The ECB will likely announce additional expansionary measures
this week as inflation in the euro area reached new lows in August (0.3
per cent yoy). In addition, the Fed stated at the Jackson Hole Economic
Symposium that “the labour market has yet to fully recover”. Unless the
ECB disappoints and the Fed turns hawkish, which is unlikely, hedge
funds may continue to post solid gains on the back of their bullish
stance on risk assets, says Lyxor.
CTAs
have benefitted the most from the recent rally thanks to their long
positions on both equities and fixed income. The Lyxor CTA index is up
in excess of two per cent in August, and is on track to post a very
solid performance for the third quarter. Meanwhile, L/S credit gave back
some gains this month on the back of the widening of European high
yield spreads. This is also true for global macro funds, which have been
impacted negatively by short duration positions on both the US and
European yield curve.
Source: HedgeWeek
