Opaque Industry Update – Hedge funds faced a challenging half-year in the first half of 2022 as geopolitical and macroeconomic events sparked market chaos and a rare, solid sell-off in equities and bonds, reports Intelligence Spotlight, per Hedge Funds in H1 2022. . However, this is not a sudden jolt from the Covid-hit first half of 2020, but steady, negative growth over the past three quarters. For example, hedge funds have still underperformed US large cap stocks have outperformed and have an opportunity to benefit from volatility and weak economic prospects and outperformance.
H1 2022. Key features of
– The Eurekage Global Composite Index for H1 2022 fell 5.4%. There was a performance contrast between a fund worth over $1 billion and a fund worth under $1 billion, as the larger funds posted a smaller 1.9% loss compared to a 5.5% loss for recorded the sub. -$1 billion category.
– Assets under management decreased $78.8 billion in the first six months of 2022, driven by $37.7 billion of performance-related declines and $41.1 billion of net outflows was. The industry total at the end of the first half is $4.02 trillion.
– Europe saw the largest net outflow of $36.0bn in the first half as investor sentiment in the region was hit hardest by the ongoing Russia-Ukraine conflict and Europe’s reliance on Russian energy supplies. In contrast, North America and Asia saw smaller AuM declines of $11.5 billion and $14.5 billion, respectively.
– Fixed income (-$21.6 billion) and long/short equities (-$21.2 billion) saw the largest outflows in the first half as the two strategies struggled in a rising interest rate environment, leading to resulted in a performance-based decline of $23.4 billion and $40.9 billion, respectively. ,
– Most major asset classes ended the first half of 2022 in negative territory, with bond markets posting their worst six months since 1900, while the S&P 500 posted its worst first half since 1970. Despite this, the hedge fund has outperformed the S&P 500 (vs. -5.4%). -20.6%) are the best-performing CTAs due to their downside protection strategies and optimized, shorter timeframes for hedging stock corrections.
– Defensive strategies continued to outperform, with managed futures/CTAs halving Q1 gains to 7.3%, delivering just like 2008 at a critical time for investors.
The industry experienced its third consecutive quarter of outflows in the second quarter of 2022. After a $13.5 billion repayment in the first quarter of 2022, there was another outflow of $26.6 billion in the second quarter as investors seek liquidity to provide resilience in a crisis.
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