In the week ending April 2nd 2021, eVestment Hedge Fund Asset Flows Report said that global hedge funds continued their strong start to 2021 with elevated asset flows in February. Positive flows for the industry in February have been the norm since 2009, but the $16.44 billion investors added to hedge funds last month, coupled with January s inflows, made this the best two-month start for the business since 2014. Strong performance in January and February was also a plus, bringing the hedge fund industry s overall AUM to $3.407 trillion.
Meanwhile, the HFM Long/Short Equity Composite is up 6.0% YTD through February 2021, overtaking the S&P 500 on a 12-month basis after another strong month. The HFM Managed Futures Composite Index was up 3.0% in February, after posting -0.2% in January, as the average CTA returned to positive territory YTD (2.8%).
In the week ending March 05th, 2021, data provider Preqin said that hedge funds assets under management (AUM) grew to just shy of $4tn in Q4 2020, mainly driven by performance. AUM rose $299bn from the end of Q3, marking 9.3% growth since the end of 2019 and reaching an all-time high of $3,995bn.
Hedge funds also started 2021 strongly outperforming the global equity market amidst the turbulence in retail trading resulting in a risk-off environment, said Eurekahedge. Hedge fund managers returned 1.00% in January 2021, outperforming the global equity market as measured by the MSCI ACWI (Local) which returned 0.11%.
Meawhile, a sharp spike in bond yields last week caught some hedge funds unaware, and saw macro and long-short funds in general give back February profits to end the month modestly up, several market participants said.
Other Voices: UK private funds face Brexit challenges Thursday, March 04, 2021
By: Elena Faloutsou, Greg Norman, Abigail Reeves - Skadden
The negotiations that culminated in the establishment of the Trade and Cooperation Agreement (TCA) at the end of 2020 concluded with no meaningful agreement in relation to the provision of financial services between the United Kingdom and the European Economic Area (EEA). For the private funds community operating in the UK, this result was disappointing but not unexpected. Private fund sponsors and managers have implemented different solutions since the 2016 Brexit referendum to address this outcome. In this article, we explore some of those solutions and what may follow now that the transition period has concluded.
In the week ending February 19th 2021, eVestment released January 2021 hedge fund performance data which showed that hedge funds started 2021 on a high note with average industry performance of +1.02% with 59% of funds seeing positive results for the month. This follows a tumultuous 2020 which saw the hedge fund business return an average +11.07%.
Meanwhile, according to Lyxor, risk assets experienced a strong rebound in recent weeks, which benefitted Directional L/S (+3.8%) and Special Situation (+2.7%) strategies on a month-to-date basis. On a year-to-date basis, Merger Arbitrage remains the best performing strategy (+2.4%) in a context where SPACs experienced a sharp rebound (+17.9% for the IPOX SPAC Index year-to-date).
In the week ending February 5th 2020, Preqin said that returns across hedge fund asset class were +16.63%, ahead of the S&P 500 PR Index (16.26%), resulting in the asset class' highest annual return since 2009. Hedge funds also offered downside