The world’s wealthiest private investors are planning to put more money into alternative investments over the next three years, a report says.
The study said the global rich are increasingly attracted by private equity schemes and hedge funds as they offer more stable returns than shares.
Here’s a recent news release to show that September 2007 was just the beginning of this trend.
September Best Month for Hedge Funds in Years
Hedge Funds Return +3.27% in September 2007 and +9.40% Year-to-Date
Early estimates show the HFN Hedge Fund Aggregate Average, an equal weighted average of all single manager hedge funds and CTA/managed futures products in the HedgeFund.net database, was +3.27% in September 2007. The increase was the largest in over four years, and the second largest month for hedge funds in eight years. The HedgeFund.net database consists of over 7,700 current hedge fund, fund of funds, and CTA products.
Hedge funds across most strategies benefited from the U.S. Federal Reserve’s attempt to ease extremely tight credit markets. Strategies which fared worst in August came back strong to erase previous month’s losses. Commodity related funds performed extremely well as the Fed rate cut spurred inflationary concerns. The HFN CTA/Managed Futures Average, with 234 products reporting September performance, was +6.15% and is +7.11% YTD. Energy sector funds also took advantage of oil rising above $80/barrel and the HFN Energy Sector Average finished September +4.99% and is +13.95% YTD. Emerging market funds returned an average of +4.60% and the HFN Emerging Markets Average is +16.79% YTD.
Excellent performance wasn’t limited to commodity related strategies. Equity markets surged after the U.S. Fed rate cut and strategies which typically maintain long biases were rewarded. Long only funds were +3.15% in September while long/short equity managers were +2.98% and the HFN Long Only and Long/Short Equity Averages are +10.55% and +10.66% YTD, respectively. The fact that long/short equity managers are outperforming long only funds YTD is likely a testament to maintaining short exposure during volatile periods. Other equity related strategies which performed well in September include technology sector funds +8.33%, small/micro cap funds +4.32%, and healthcare sector funds +3.50%.
Macro funds which often position themselves across multiple asset classes appear to have taken advantage of the strong moves seen in interest rate, currency and commodity markets. The average macro fund was +3.93% in September and the HFN Macro Average is +9.18% YTD. The global macro strategy was one of a handful of strategies tracked by HFN to outperform broad equity markets in the third quarter, returning +3.97% during the difficult three month span.
Distressed managers returned an average of +0.57% in September, ending a two month streak of negative performance, but were still -2.06% in Q3 2007 and +5.85% YTD, their worst nine month start since 2002. Short bias funds were the only strategy posting negative returns in September, -2.45%, and the HFN Short Bias Average fell back to negative territory YTD, -1.43%.
A full report on September performance will be available at
http://www.hedgefund.net later in the month.
The table below is a summary of September 2007 returns for a selection of
HFN Averages:
September* YTD 2007** Full Year
HFN Aggregate Averages 2006**
HFN Hedge Fund Aggregate Average 3.27 % 9.40 % 11.99 %
HFN Regional Averages***
HFN Asia Average 4.33 % 14.84 % 8.22 %
HFN Europe Average 1.00 % 6.37 % 15.37 %
HFN US Average 3.17 % 8.47 % 11.04 %
HFN Latin America Average 3.83 % 20.81 % 29.86 %
HFN Single Strategy Averages
HFN Convertible Arbitrage Average 1.68 % 4.73 % 12.84 %
HFN CTA/Managed Futures Average 6.15 % 7.11 % 6.89 %
HFN Distressed Average 0.57 % 5.85 % 14.90 %
HFN Emerging Markets Average 4.60 % 16.79 % 22.46 %
HFN Energy Sector Average 4.99 % 13.95 % 13.32 %
HFN Event Driven Average 1.01 % 7.13 % 13.76 %
HFN Long/Short Equity Average 2.98 % 10.66 % 12.10 %
HFN Macro Average 3.93 % 9.18 % 10.46 %
HFN Market Neutral Equity Average 1.46 % 5.32 % 6.58 %
*Estimated results of funds reporting September 2007 performance as of
October 9, 2007
**Estimated results for all funds having reported performance as of
October 9, 2007
***Regional averages derive performance from returns of funds investing
primarily in those regions.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS
HedgeFund.net (HFN), a division of Channel Capital Group Inc, is a leading source for hedge fund news and information. Investors who meet HedgeFund.net’s accreditation standards are eligible for access to an online database of more than 7,700 hedge funds, funds-of-funds and CTA/managed futures products. HFN serves a rapidly growing user base of more than 35,000 accredited investors worldwide. Registered users include a wide range of institutional investors and high net worth individuals.
For more information or to register, please go to http://www.HedgeFund.net.
HedgeFund.net Contact:
Joel Schwab
Managing Director
Channel Capital Group Inc.
t: (212) 381-8065
SOURCE HedgeFund.net
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