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Index Press Release - 08 January 2013


Hedge funds end 2012 with gains of 6.19%, assets at US$1.78 trillion

2012 finished up on a positive note with hedge funds posting substantial gains across all regional and strategic mandates in December. The Eurekahedge Hedge Fund Index was up 1.46%1, bringing its year-to-date return to 6.19%. The capital-weighted Mizuho-Eurekahedge Top100 Index, which tracks the assets and performance of the largest 100 hedge funds, gained 5.82% in 2012.

Key takeaways for the month of December 2012:

  • The Eurekahedge Hedge Fund Index was up 1.46% in December and up 6.19% in 2012

  • Distressed debt funds continued to be the year’s best performing strategy with gains of 1.61% in December and 12.87% year-to-date

  • Total asset flows for the year stood at US$69 billion, taking the size of the industry to US$1.78 trillion%

  • North American hedge funds attracted the most assets out of all regions in 2012 with inflows of US$56 billion or growth of 5%. Relative value mandated funds witnessed the largest percentage increase in AUM year on year - US$11 billion, or up 23% in 2012

  • 821 funds were launched in 2012 with 778 closures as compared with 1139 launches and 841 closures in 2011

  • In 2012, 1664 hedge funds have reported an annual return above 10% and 555 hedge funds with an annual return above 20%

  • Latin American (10.30%) and Eastern European & Russian (7.95%) funds were 2 of the regional mandates that outperformed equity markets2
 

Main Indices

Main Indices December
2012*
2012 Returns 2011 Returns
Eurekahedge Hedge Fund Index 1.46 6.19

-3.15

Eurekahedge Fund of Funds Index 1.02 3.98 -5.32
Eurekahedge (Long-Only) Absolute Return Fund Index 3.11 15.63 -13.86
Eurekahedge Islamic Fund Index 1.95 7.64 -3.49

 

Regional Indices

Regional Indices December
2012*
2012 Returns 2011 Returns
Eurekahedge North American Hedge Fund Index 0.64 6.83 0.11
Eurekahedge European Hedge Fund Index 0.89 6.89 -6.07
Eurekahedge Eastern Europe & Russia Hedge Fund Index 3.61 7.95 -20.59
Eurekahedge Japan Hedge Fund Index 3.27 5.91 -1.30
Eurekahedge Emerging Markets Hedge Fund Index 2.66 1.82 -8.22
Eurekahedge Asia ex-Japan Hedge Fund Index 4.02 12.57 -12.40
Eurekahedge Latin American Hedge Fund Index 1.77 10.30 1.92

It was a year coupled with risks and rewards in 2012 with high levels of activity surrounding the financial markets: more money printing, sovereign bailouts, the Spanish banking crisis, the potential Greek exit from the euro and almost half of the major countries had presidential elections taking place - including France, China, Korea and the US.

Hedge funds across all regions witnessed positive returns for the month with Asian hedge funds posting the best performance numbers. December was a strong month for the Japan market as Prime Minister Shinzo Abe took to office highlighting an agenda of economic recovery through fiscal stimulus and monetary easing. The Tokyo Topix was up 10.02% last month and the Eurekahedge Japan Hedge Fund Index posted strong gains of 3.27%. Asia ex-Japan hedge funds provided the highest returns against other regions’ performance for the year, up 12.57% after a strong 4.02% in December. Within Asia Pacific, the Eurekahedge Greater China Hedge Fund Index and Eurekahedge India Hedge Fund Index rose 14.60% and 14.93% respectively.

 

Strategy Indices

All strategic mandates were in the black for December, with multi-strategy hedge funds posting the strongest gains of 2.37% for the month and 8.55% for the year. Some winning managers capitalised on gains from dollar fixed income exposures as well as defaulted sovereign notes. CTA/managed futures funds reported a positive return of 1.13% for the first time since July 2012, ending a four-month loss reporting period - year-to-date performance stands at a marginal 0.71%. Relative value mangers gained on average 1.34% in December and the Eurekahedge Relative Value Hedge Fund Index was up 10.51% by the end of 2012. Managers reported December profits contributing from short positions in energy, long positions in financial and consumer sectors.

Strategy Indices December
2012*
2012 Returns 2011 Returns
Eurekahedge Arbitrage Hedge Fund Index 0.92 6.73 1.40
Eurekahedge CTA/Managed Futures Hedge Fund Index 1.13 0.71 0.06
Eurekahedge Distressed Debt Hedge Fund Index 1.61 12.87 -1.11
Eurekahedge Event Driven Hedge Fund Index 2.37 9.18 -4.39
Eurekahedge Fixed Income Hedge Fund Index 1.25 10.90 0.69
Eurekahedge Long/Short Equities Hedge Fund Index 1.62 7.64 -6.80
Eurekahedge Macro Hedge Fund Index 0.78 2.10 -1.11
Eurekahedge Multi-Strategy Hedge Fund Index 2.37 8.55 -2.10
Eurekahedge Relative Value Hedge Fund Index 1.34 10.51 -1.51

 

Mizuho-Eurekahedge Indices December
2012*
2012 Returns 2011 Returns
Mizuho-Eurekahedge Index - USD 1.28 5.67 -2.07
Mizuho-Eurekahedge TOP 100 Index - USD 0.82 5.82 1.87
Mizuho-Eurekahedge TOP 300 Index - USD 1.09 5.55 0.04

 

Asia-Eurekahedge Indices December
2012*
2012 Returns 2011 Returns
Eurekahedge Greater China Hedge Fund Index 6.37 14.60 -13.08
Eurekahedge India Hedge Fund Index 2.75 14.93 -24.87

 


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Footnotes

1Based on 14.53% of funds which have reported December 2012 returns as at 8 January 2013
2MSCI regional Indices compared against EH regional Indices respectively (MSCI World All Cap, MSCI North America All Cap, MSCI Europe All Cap, MSCI Emerging, Eastern Europe Index IMI, MSCI Emerging Markets , MSCI Asia All Cap, MSCI Asia Pacific Ex Japan All Cap, MSCI Japan All Cap Local , MSCI China Local, MSCI India Local, MSCI Australia All Cap Local, MSCI EM Latin America)

 

 


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