Research

Hedge Fund Performance Commentary

Introduction

Hedge funds posted their fifth consecutive month of gains this year, up 0.33%1 during the month of May. Meanwhile, underlying markets, as represented by the MSCI AC World Index (Local) which were up 1.09% over the same period. Equity markets performed well this month with strength led by developed markets. Encouraging macroeconomic data from Europe and Japan buoyed economic recovery sentiments with growth in manufacturing activity adding to much optimism. On the other hand, data coming out of the US was rather lukewarm with weaker than expected inflation figures and jobs data.

Figure 1: May 2017 and April 2017 returns across regions
 

 

Among regional mandates, Japan mandated hedge funds topped the table for the month, gaining 1.58%, followed by Asia ex-Japan and European mandated hedge funds with gains of 0.93% and 0.74% respectively. Emerging markets hedge funds were also up 0.24% this month. On the other hand, Latin American mandated hedge funds posted the steepest decline, down 0.74% followed by their North American counterparts with losses of 0.27%.

On a year to-date basis, hedge funds are up 3.28% while underlying markets gained 7.45%. Asia ex-Japan hedge fund managers led the table up 7.91% followed by their emerging markets and Latin American counterparts with gains of 7.06% and 6.39%.

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Footnote
1Based on 48.26% of funds which have reported May 2017 returns as at 14 June 2017
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