| Market movements
Hedge funds of various strategy types have been carving out positive returns in recent days, shrugging off the stock market disruption of late January that squeezed returns among many managers, while certain long-standing industry behemoths unveiled new strategies this week to capitalise on the prevailing investment environment.
Eight out of the nine underlying managers that make up Brummer & Partners’ long-running multi-strategy BMS hedge fund vehicle, have risen into positive territory in the first two weeks of February. The Stockholm-based fund, which dipped into the red in January after ending 2020 on a high, is currently enjoying a strong rebound across its underlying funds, with equities, macro and quant strategies driving performance, Brummer said.
Similarly, trend-following hedge funds have roared into life in recent weeks after a dull start to 2021, according to Société Générale’s benchmark indices. This sector, which endured a topsy-turvy 2020, surged in the first two weeks of February amid emerging trends particularly in equities and commodities, SocGen data shows.
The fallout from the GameStop/Reddit online trading saga, which hit several hedge funds hard last month, continues to rumble on. US hedge fund titan Kenneth Griffin, whose Citadel Securities trading unit was caught up in the late January trading frenzy, told US lawmakers on Thursday that the episode demonstrates the need to overhaul the settlement process, and called for a shorter settlement window for trades to curb risks.
Elsewhere, two giants of the asset management industry have unveiled new strategies aimed at capitalising on evolving investment opportunities.
CQS, the established multi-strategy credit-focused hedge fund firm led by Sir Michael Hintze, has rolled out a new total return credit offering targeting corporate sub-investment grade credit amid increased market volatility. Pictet Asset Management, the investment management arm of the Geneva-headquartered wealth management giant Pictet Group, launched an emerging markets-focused fund that will invest across equities, credit, sovereign bonds, sovereigns, currencies and more.
Finally, this week’s feature story examines Prime Capital AG’s long-running flagship fund of hedge funds, PCAM Blue Chip. Tilo Wendorff, head of absolute return at the Frankfurt-based firm, discusses its alpha-based approach to manager selection, its impressive 13-year track record, and offers some forthright views on the burgeoning cryptocurrency market and evolving CTA sector.
Hugh Leask
Editor, Hedgeweek
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