News & Events Archive

Archive Year
June 2020

The Eurekahedge Report - June 2020

Eurekahedge

The benchmark Eurekahedge Hedge Fund Index was up 2.03% in June 2020 and down 2.63% year-to-date. Total assets under management increased by US$16.7 billion during the month as the sector witnessed performance-based gains of US$9.3 billion while registering net asset inflows of US$7.4 billion. The total size of the industry now stands at US$2,097.9 billion.


Asset Flows Update

Eurekahedge

The Eurekahedge Hedge Fund Index was up 2.03% in May, supported by strong equity market performance as represented by the MSCI ACWI (Local), which gained 4.32%. Global equities ended the month on a positive note driven by market optimism on the reopening of major economies and expansionary central bank policies. The tech-heavy NASDAQ recorded a new all-time high as it gained 6.75% in May, while the S&P 500 was up 4.53% over the same period. In the same vein, European equities also climbed as the French and German governments unveiled a half-trillion recovery fund to help EU countries hit by the pandemic.


Hedge Fund Performance Commentary

Eurekahedge

The Eurekahedge Hedge Fund Index was up 2.03%1 in May, supported by the robust performance of the global equity market as represented by the MSCI ACWI (Local), which gained 4.32% over the same month. Global equities continued its rally driven by the reopening of major economies and accommodative central bank policies. For the week ending May 15, the market saw a decline in risk assets owing to concerns regarding the second pandemic wave and fresh tension between the US and China, pushing the S&P 500 down 2.26%.


Trade finance fund managers outperformed major hedge fund strategies amidst COVID-19 pandemic

Eurekahedge

Trade finance hedge funds have gained traction over recent years, driven by investor demand for alternative asset classes with low volatility and consistent return, as well as low correlation against the broader financial market. The sector began its rapid growth following the global financial crisis in 2008, when banks started reducing their trade finance exposure to meet Basel III capital requirements. To address the lack of a standard benchmark for this niche hedge fund strategy, Eurekahedge launched the industry’s first trade finance hedge fund index in 2018, providing institutional investors with a benchmark index representing the performance of trade finance hedge fund managers.


Key Trends in Funds of Hedge Funds (June 2020)

Eurekahedge

Multi-manager funds were down 5.05% over the first four months of 2020, underperforming their single-manager counterparts who lost 4.59% over the same period. In 2019, the fund of funds industry registered 8.59% return - recording their best annual performance since 2009.


Funds of Hedge Funds Infographic June 2020

Eurekahedge

Eurekahedge’s funds of hedge funds infographic sums up the industry as at June 2020. Find out more about funds of hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


Interview with Michael Pomada, President & CEO and Lisa Martin, Director of Business Development at Crabel Capital Management, LLC

Eurekahedge

Crabel Capital Management is a global alternative investment firm specializing in systematic, automated trading of global futures and foreign exchange. Our Los Angeles based firm was founded by short-term trading pioneer Toby Crabel and has delivered over 25 years of uncorrelated returns for its institutional clients. The firm has developed a diverse array of trading strategies designed to systematically capture market anomalies implemented through a technologically advanced, low latency infrastructure. Global co-location facilities and proprietary execution algorithms allow the firm to efficiently trade in approximately 200 futures and foreign exchange markets.


Covid-19: pressure points: the economic impact on the European venture capital industry

Aaron White and Victor Chiew - Herbert Smith Freehills LLP

The COVID-19 pandemic is creating significant economic challenges for industries world-wide. The European venture capital industry and the start-up ecosystem it supports is no exception.


Impact of COVID-19 on Private Fundraisings, Comparisons to GFC and Looking Ahead

Guo Sun Lee, Alex Lam, Alexander Cheng and Andrew Watson - King & Wood Mallesons

The COVID-19 pandemic continues to adversely impact fundraising activity of private equity funds. In this report, we summarise the current fundraising environment, our experience from the 2007-2009 global financial crisis (“GFC”), our experience from the COVID-19 outbreak, innovations for fundraising during the COVID-19 outbreak that we have devised for fund managers based on our experience from the GFC and silver linings.


Covid-19: considerations for private fund managers

Alex Amos and Christopher Good - Macfarlanes LLP

Over the past few weeks, our private fund manager (GP) clients have been focusing on their portfolios, supporting investments with liquidity concerns as cashflows dry up, and exploring new opportunities in dislocated markets. At the fund level, the immediate preoccupation of GPs has been valuations – particularly for their Q1 reporting to investors (LPs).


May 2020

The Eurekahedge Report - May 2020

Eurekahedge

The benchmark Eurekahedge Hedge Fund Index was up 4.03% in April 2020 and down 4.33% year-to-date. Total assets under management increased by US$27.0 billion during the month as the sector witnessed performance-based gains of US$24.0 billion while registering net asset inflows of US$3.0 billion. The total size of the industry now stands at US$2,065.5 billion.


Asset Flows Update

Eurekahedge

The Eurekahedge Hedge Fund Index was up 4.03% in April, supported by the strong performance of the global equity market which pushed the MSCI ACWI IMI (Local) up 10.47% over the month. Global equities enjoyed a strong rally throughout the month on the back of optimism over the development of potential COVID-19 vaccines and the reopening of the economy.


Hedge Fund Performance Commentary

Eurekahedge

The Eurekahedge Hedge Fund Index was up 4.03% in April – registering its best month since May 2009, supported by the robust performance of the underlying global equity market as represented by the MSCI ACWI IMI (Local) which gained 10.47% over the month. Global equities recouped some of the losses they suffered in March on the back of market optimism over the development of potential vaccineThe Eurekahedge Hedge Fund Index was up 4.03% in April – registering its best month sis and the reopening of the economy.


Alternative Equity ETF and Hedge Fund Performance Comparison

Eurekahedge

Exchange-traded funds (ETFs) have become an increasingly crucial tool for both institutional and retail investors to gain exposure to certain markets or hedge risks at a low cost in recent years. The explosive growth of the assets managed through ETFs has been largely driven by the increase in popularity of index funds, ETFs designed to track the performance of an index. An index fund could be used by retail investors to passively invest in equity markets, or by fund managers to easily adjust their portfolio exposure towards certain markets.


Key Trends in North American Hedge Funds (May 2020)

Eurekahedge

The Eurekahedge North American Hedge Fund Index was down 9.61% year-to-date as of March 2020, outperforming the underlying equity market as represented by the MSCI North America IMI, which lost 21.40% over the same period. The severity of the COVID-19 outbreak outside Mainland China has forced government authorities to implement lockdown and social distancing measures, resulting in a massive sell-off in the global equity market.


North American Hedge Funds Infographic May 2020

Eurekahedge

Eurekahedge’s North American hedge funds infographic sums up the industry as at May 2020. Find out more about North American hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


Interview with Asim Ghaffar, CIO of AG Capital Investments, LLC

Eurekahedge

Asim founded AG Capital in 2014. He has a background in economics, strategy, and investment consulting, as well as futures trading and risk management. Most recently, he worked as an investment consultant in Cambridge Associates, LLC’s Boston office, where he advised foundations, universities, private clients, and insurance groups in the U.S. ranging in size from $100 million to $20 billion. Prior to joining Cambridge Associates, Asim was a Principal at Partners Capital Investment Group, LLC, an international investment advisory firm. Before that, he was a strategy consultant at Bain & Company, Inc. He began his career as an economics and business consulting analyst at Charles River Associates, Inc


ASIC releases regulatory framework for foreign financial services providers

Peter Reeves and Emily Shen - Gilbert + Tobin

Following its consultation in July 2019, the Australian Securities and Investments Commission (ASIC) has unveiled its highly anticipated regulatory framework for foreign financial services providers (FFSPs). The introduction of the announced foreign Australian financial services licence (FAFSL) regime and funds management relief replaces the existing passport relief and limited connection relief for FFSPs and is likely to impact the funds landscape in Australia.


Fund Marketing and Overseas Fund Regime HM Treasury Consultation Paper

Bethany Bloor and Paul Anderson - Squire Patton Boggs

Many investment funds domiciled in the EU are currently marketed in the UK through the EU’s passporting regime. Shortly after the end of the Brexit transition period of 31 December 2020, and the end of the UK’s temporary regime to permit marketing, this will change and funds will have to gain permanent market access in the UK.


April 2020

The Eurekahedge Report - April 2020

Eurekahedge

The benchmark Eurekahedge Hedge Fund Index was down 4.77% in March 2020 and 6.42% year-to-date. Total assets under management decreased by US$136.2 billion during the month as the sector witnessed performance-based decline of US$94.0 billion while registering net asset outflows of US$42.2 billion. The total size of the industry now stands at US$2,122.9 billion.


Asset Flows Update

Eurekahedge

The Eurekahedge Hedge Fund Index was down 4.77% in March, outperforming the underlying equity market as represented by the MSCI ACWI IMI (Local), which lost 13.99% over the month. Global equities ended the month with double-digit losses, despite the partial recovery toward the end of the month, driven by fiscal and monetary stimulus packages. The situation surrounding the COVID-19 outbreak continued to worsen around the globe, with the United States overtaking China and Italy as the country with the highest number of confirmed cases. US authorities were forced to implement lockdown in most states adversely affected by the coronavirus outbreak, with New York being the hardest hit.


Hedge Fund Performance Commentary

Eurekahedge

The Eurekahedge Hedge Fund Index was down 4.41% in March, outperforming the underlying equity market as represented by the MSCI ACWI IMI (Local), which lost 13.99% over the month. Global equities were under pressure from the market sell-offs throughout most of the month, before recouping some of their losses later on. The COVID-19 outbreak continued to worsen globally, with the United States overtaking China as the country with the highest number of confirmed cases. US authorities were forced to implement stringent social distancing measures in an attempt to flatten the outbreak curve, resulting in increasing unemployment rate and slowing economic growth as businesses deemed non-essential were forced to temporarily cease their operations.


Hedge Fund Round Up Q1 2020

Eurekahedge

Hedge fund managers ended the first quarter of 2020 down 6.42%, while delivering their strongest post-2008 monthly outperformance over the global equity market as represented by the MSCI ACWI IMI. The escalation of the COVID-19 outbreak, which has spread to more than a hundred countries around the globe over the past two months, has weighed on the performance of risk assets in February and March.


Key Trends in European Hedge Funds (April 2020)

Eurekahedge

The Eurekahedge European Hedge Fund Index was down 2.48% as of February 2020 year-to-date, outperforming the MSCI AC Europe IMI, which lost 9.79% over the same period. In the fourth quarter of 2019, the European equity markets rose higher, supported by the positive geopolitical development surrounding the US-China trade negotiations as the two leading economies reached the phase-one deal, which was signed in January 2020. The DAX and CAC 40 gained 6.61% and 5.29% in Q4 2019, reaching new all-time highs. However, market risk sentiment shifted quickly in February 2020 as the extent of the COVID-19 outbreak outside China resulted in concerns over the global economic growth.


Key Trends in UCITS Hedge Funds (April 2020)

Eurekahedge

Since the onset of the global financial crisis, investors worldwide have grown more cautious in undertaking investments and have increased their demands for underlying investment products and instruments to be monitored by international compliance standards. The Undertakings for Collective Investment in Transferable Securities or ‘UCITS’ was developed to meet this post-crisis demand, as UCITS embodied by strong regulation results in a high level of investors’ protection with certain restrictions such as liquidity of the underlying assets and leverage caps to provide added transparency to investors.


European Hedge Funds Infographic April 2020

Eurekahedge

Eurekahedge’s European hedge funds infographic sums up the industry as at April 2020. Find out more about European hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


UCITS Hedge Funds Infographic April 2020

Eurekahedge

Eurekahedge’s UCITS hedge funds infographic sums up the industry as at April 2020. Find out more about UCITS hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


Interview with Christopher Cole, CFA - Founder & CIO, Artemis Capital Management

Eurekahedge

Christopher R. Cole, CFA, is the Founder & CIO of Artemis Capital Management LP. Mr. Cole’s core focus is systematic, quantitative, and behavioral-based trading of volatility and derivatives. His decision to form a fund came after achieving significant proprietary returns during the 2008 financial crash trading volatility futures and options (verified by an independent auditor).


Stress testing COVID-19: Macro explains market moves

Mahmood Noorani - Quant Insight

COVID-19 has been a major macroeconomic shock for the world. As a result, we have seen very large moves in inflation expectations, real GDP growth, credit spreads and energy prices across regions. These shifts in “macro factors” have deeply impacted all asset classes.


Overview of Cayman Islands law governing mutual funds – Q&A

Gary Smith - Loeb Smith

The primary legislation regulating mutual funds in the Cayman Islands is the Mutual Funds Law (As Revised) (the “Funds Law”) and accompanying regulations, including the Retail Mutual Funds (Japan) Regulations (As Revised) which generally apply to investment funds licensed under the Funds Law (licensed funds) where the securities are marketed to the public in Japan. The term “mutual fund” applies for Cayman Islands law purposes to all open-ended investment funds irrespective of whether they are hedge funds or other fund with multiple strategies.


COVID-19: Certain Fund-Related Considerations for Private Equity Managers

Matthew B. Goldstein, Udi Grofman, Amran Hussein, Conrad van Loggerenberg, Marco V. Masotti, and Lindsey L. Wiersma - Paul, Weiss, Rifkind, Wharton & Garrison

The cascading impacts of the coronavirus outbreak (COVID-19) on markets and businesses are creating a variety of challenges and opportunities for private equity funds. General partners (“GPs”) may want to consider a variety of proactive steps, including reviewing investment objectives; altering fund documents; being more proactive in information sharing, valuations and reporting; reviewing borrowing limitations and derivative contracts; and other protective measures.


March 2020

The Eurekahedge Report - March 2020

Eurekahedge

The benchmark Eurekahedge Hedge Fund Index was down 1.73% in February 2020 and 1.66% year-to-date. Total assets under management decreased by US$32.1 billion during the month as the sector witnessed performance-based decline of US$33.8 billion while registering net asset inflows of US$1.7 billion. The total size of the industry now stands at US$2,270.6 billion.


Asset Flows Update

Eurekahedge

The Eurekahedge Hedge Fund Index was down 1.73% in February, outperforming the underlying equity market as represented by MSCI ACWI (Local) which plummeted 7.84% over the same period. Global equities started the month on a positive note, driven by the market optimism towards the containment of the COVID-19 as the number of newly infected people in Mainland China decelerated and central banks announced stimulus packages.


Hedge Fund Performance Commentary

Eurekahedge

The Eurekahedge Hedge Fund Index was down 1.73% in February, outperforming the underlying global equity market as represented by the MSCI ACWI (Local) which lost 7.84% over the month. Global equities rallied earlier into the month, supported by the improving situation in China over the COVID-19 outbreak and stimulus packages announced by central banks. The tech-heavy NASDAQ Composite recorded a new all-time high for the week ending February 14, as the encouraging macroeconomic data in the region also contributed to its performance during the period.


Tail risk protection: The price of watching over your tail

Eurekahedge

The return of market volatility on the back of the escalating COVID-19 outbreak situation around the globe has pushed two particular niche hedge fund strategies back into the spotlight: the CBOE Eurekahedge Long Volatility Hedge Fund Index and the CBOE Eurekahedge Tail Risk Hedge Fund Index returned 10.27% and 12.28% respectively in February 2020. The two strategies which provide crisis alpha and protection for institutional portfolios have long since generated debates among asset owners and academics alike.


Key Trends in Global Hedge Funds (March 2020)

Eurekahedge

The Eurekahedge Hedge Fund Index was up 0.08% year-to-date as of January 2020, outperforming the underlying global equity market as represented by the MSCI ACWI IMI, which was down 0.89% over the same period. In 2019, the positive development of the US-China trade negotiations and the Fed’s shift of stance on their policy rates were the primary drivers of the global equity market performance.


Global Hedge Funds Infographic March 2020

Eurekahedge

Eurekahedge’s global hedge funds infographic sums up the industry as at March 2020. Find out more about global hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


The ILPA Model LPA - Why Managers Should Consider Pushing Back

Gus Black, Russel G. Perkins, Omoz Osayimwese and Nathalie Sadler - Dechert LLP

The Institutional Limited Partners Association (“ILPA”) has recently issued a publicly available model private equity limited partnership agreement (the “Model LPA”) as part of its simplification initiative. ILPA is an international organization that represents the limited partner community, although it also works with managers of private equity funds and other practitioners when publishing its model texts and guidelines. One of ILPA’s principal aims in publishing the Model LPA is to standardize a document that is generally negotiated on a bespoke basis.


February 2020

The Eurekahedge Report - February 2020

Eurekahedge

The benchmark Eurekahedge Hedge Fund Index was up 0.14% in January and 8.67% in 2019. Total assets under management increased by US$2.0 billion during the month as the sector witnessed performance based increase of US$1.6 billion while registering net asset inflows of US$0.4 billion. The total size of the industry now stands at US$2,304.6 billion.


Asset Flows Update

Eurekahedge

The Eurekahedge Hedge Fund Index ended 2019 up 8.67%, recording its strongest annual performance since 2013 on the back of the de-escalation of the US-China trade war and accommodative central bank policies. Going into 2020, hedge fund managers returned 0.14% in January, outperforming the MSCI ACWI (Local) which slumped 0.90% over the month following the COVID-19 outbreak in China. Despite liquidity injection by the People’s Bank of China and the reduction of tariffs on US imports, investors remained concerned on the impact of the epidemic on the global economic outlook. Returns were mixed across regions in January, with Asia ex-Japan fund managers returning 0.93%, ahead of their peers focusing on North America, who ended the month down 0.11%. Long/short equities fund managers were down 0.35% in January as the weak equity market performance throughout the latter half of the month weighed on their returns.


Hedge Fund Performance Commentary

Eurekahedge

The Eurekahedge Hedge Fund Index was up 0.14% in January, ahead of the underlying equity market as represented by the MSCI ACWI (Local) which lost 0.90% over the same period. Global equities rallied earlier into the month, supported by the easing tension in the Middle East and the signing of the US-China phase-one trade deal. The S&P 500 and the tech-heavy NASDAQ returned 2.29% and 1.97% respectively for the week ending January 17. However, market sentiment shifted rapidly towards the end of the month, following the coronavirus outbreak in China. Investors feared that the epidemic, which draws parallel to the SARS outbreak in 2003 might have an adverse impact on the global economic outlook.


Continued loss creep from past events curtailed ILS fund performance in 2019

Eurekahedge

The Eurekahedge ILS Advisers Index gained 0.92% in 2019, following two consecutive years of losses during which ILS fund managers with catastrophe risk exposure suffered from the damage caused by the Atlantic hurricane seasons. Despite being a period of calm insurance losses, 2019 saw ILS fund managers languishing under loss creep from upward adjustments in estimated losses of past events. Insurance-linked securities (ILS) hedge funds trade in instruments whose values depend on insurance loss events. The majority of these instruments are reinsurance policies that assume the risk taken by insurance companies, which in turn assume the risk taken by individuals or institutions.


Key Trends in Islamic Hedge Funds (February 2020)

Eurekahedge

The Islamic finance industry is a niche market predominantly serving the needs of the world’s Muslim population. Products marketed under the umbrella of Islamic finance comply with a different investment philosophy as opposed to traditional investment philosophy which the rest of the world are familiar with. Under a Shariah-compliant framework, transactions which are considered to be unethical under Islamic law are prohibited and instead, fund managers invest in products which are compliant with Islamic guidelines. Islamic financial products are accessible to all investors, some of whom choose to allocate into Islamic funds for purposes of portfolio diversification or their preference in investing in products which deemed as socially responsible. In recent years, Islamic finance has been catching on with traditional finance institutions as international banks have expanded into providing Islamic finance services.


Islamic Hedge Funds Infographic February 2020

Eurekahedge

Eurekahedge’s Islamic hedge funds infographic sums up the industry as at February 2020. Find out more about Islamic hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


Interview with Dino Skandalis, CEO and CIO of P79 Capital Limited

Eurekahedge

Dino has over 27 years of experience in global trade finance and debt markets both in the banking and investment management sectors. He has served as global head of trade finance related products for Standard Chartered Bank, Standard Bank, and Banco Santander where he managed trading and investment portfolios in the trade finance related sector and market leading origination and trading desks.


How the Leveraged Finance market is evolving to encompass ESG factors

Andrew Carey and Sukhvir Basran - Hogan Lovells

The year 2019 has seen responsible business, climate change and impact financing feature high on the agenda with increasing focus on the sector by investors, regulators, trade bodies and financial institutions. As a result, there is growing evidence of the influence of environmental, social and governance ("ESG") factors in mainstream finance.


New Registration Requirements for Unregulated Investment Funds

James Bergstrom, Angus Davison, Joanne Huckle, Bradley Kruger, Nick Rogers and Justin Savage - Ogier

On 8 January 2020, the Cayman Islands Government published a draft Private Funds Bill, 2020 (the Bill) and a draft amendment to the Mutual Funds Law (2019 Revision) (MFL Amendment). The proposed legislation is a result of certain EU and other international recommendations and has been developed to align the Cayman Islands investment fund regulatory regime with other jurisdictions. The Bill and the MFL Amendment are expected to be put before the Cayman Islands Legislative Assembly on 30 January 2020, where final amendments may be made before they are passed into law. It is expected that there will then be a transition period for existing structures.


What Asset Managers Need to Know—and Do—About the SEC’s Recent Focus on Impact Investment Strategies

Vadim Avdeychik - Paul Hastings LLP

The Wall Street Journal recently reported that the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) has sent letters to asset management firms that market and offer environmental, social, and governance (“ESG”) investment products. Below are some key takeaways that asset managers should know and do as the SEC focuses in on asset managers that offer impact investment strategies.


SEC Proposes Amendments to the Definitions of Accredited Investor and Qualified Institutional Buyer

Mark S. Bergman, Andrew J. Foley and Tong Yu - Paul Weiss Rifkind Wharton & Garrison LLP

The U.S. Securities and Exchange Commission (the “SEC”) has issued a release (the “Proposing Release”) (available here) proposing amendments that expand the definitions of “accredited investor” (“AI”) and “qualified institutional buyer” (“QIB”). The AI definition is used principally to determine to whom an offering can be marketed in a private placement under Rules 506(b) and 506(c) of Regulation D, and the QIB definition is used principally to determine to whom securities can be resold in a sale structured under Rule 144A.


FCA sets out its Asset Management and Alternatives Supervision Strategies

Tim Lewis, Jane Tuckley, Phil Bartram, Stephanie Biggs and Michael Raymond - Travers Smith LLP

The FCA has outlined some key risks of harm in the asset management and alternative investments sectors and the steps that firms should take to address these risks. Firms may therefore need to make changes to their current practices and procedures.


January 2020

Eurekahedge Asian Hedge Fund Awards 2020

Eurekahedge

The 17th annual Eurekahedge Asian Hedge Fund Awards will be held in Singapore for 2020. Stay tuned to this page for more updates.


The Eurekahedge Report - January 2020

Eurekahedge

The benchmark Eurekahedge Hedge Fund Index was up 1.57% in December and 8.74% year-to-date. Total assets under management increased by US$22.1 billion during the month as the sector witnessed performance-based increase of US$17.0 billion while registering net asset inflows of US$5.1 billion. The total size of the industry now stands at US$2,302.2 billion.


Asset Flows Update

Eurekahedge

The Eurekahedge Hedge Fund Index ended 2019 up 8.74%, recording its strongest annual performance since 2013. The global hedge fund industry has been supported by the global equity market rally on the back of the de-escalation of the US-China trade war and accommodative central bank policies. Positive geopolitical developments surrounding the trade war and Brexit have also sustained investors’ risk sentiment over the last quarter of the year. Returns were positive across regions, with Asia ex-Japan fund managers returning 2.58% in December, on the back of the region’s equity market rally. Fund managers focusing on Asia ex-Japan were up 12.03% over the year, outperforming their North American peers who returned 9.32% over the same period.


Hedge Fund Performance Commentary

Eurekahedge

The Eurekahedge Hedge Fund Index was up 1.57% in December and 8.74% for the year, recording its strongest annual return since 2013. The risk-on sentiment resulting from positive geopolitical development provided support for risk assets as the two-leading economies officially reached an agreement that de-escalated their 18-month long trade tension. The global equity market as represented by the MSCI ACWI (Local) ended 2019 up 23.44%. US equities recorded new all-time highs, with the S&P 500 up 2.86% in December on the back of market optimism toward the US-China phase-one deal which was signed in early 2020. Over in Europe, UK equities outperformed their European peers, thanks to the landslide victory of the UK Conservative Party, which resulted in better clarity surrounding Brexit. The FTSE 100 rose 2.67% during the month. On a similar note, positive trade development, monetary stimulus, and strong macroeconomic data acted as a tailwind to the performance of Asian equity markets, especi


Structured credit hedge funds: Staying ‘Sharpe’ in ultra-low rate environment

Eurekahedge

Structured credit traces its history back to the 20th century and has been a part of institutional and hedge fund portfolios for decades. Hedge fund managers focusing on structured credit could largely be dichotomised into those who generate returns from beta exposure to the asset class, and those who exploit mispriced instruments resulting from market inefficiency. Structured credit instruments result from the securitisation process in which multiple debt obligations are packed into interest-bearing securities whose cash flows are then sold to investors. This asset class has remained attractive to investors due to their ability to offer good return potentials and low rate of losses while providing diversification from other fixed income assets. The securitisation process also allows the final product to be tailored to an investor’s specific risk profile and constraints. On the other hand, the complexity of the instrument may result in heightened liquidity risk, and certain structured


Key Trends in Asian Hedge Funds (January 2020)

Eurekahedge

The Eurekahedge Asian Hedge Fund Index was up 7.41% year-to-date as of November 2019, supported by the robust performance of risk assets in the region resulting from the progress of the US-China trade talks. The underlying equity market, as represented by the MSCI AC Asia Pacific IMI gained 15.19% over the same period. The trade negotiation process between the two countries has faced considerable challenges throughout the year, notably when the PBOC allowed the yuan to weaken past the symbolic level of seven. The US Treasury department responded by labelling China as a currency manipulator, further escalating the tension between the two economies. However, market sentiment improved when the trade talks resumed in October, and finally concluded in a phase-one deal which was eventually signed in January 2020, shortly after the removal of China from the US Treasury list of currency manipulators. The positive geopolitical development surrounding the trade war boosted market sentiment and a


Asian Hedge Funds Infographic January 2020

Eurekahedge

Eurekahedge’s Asian hedge funds infographic sums up the industry as at January 2020. Find out more about Asian hedge funds assets under management (AUM), asset flows into strategic and regional mandates, strategy returns, fund size and geographic AUM, head office locations and the best and worst performances of the year.


CFTC Amendments to Registration and Compliance Rules — Lessons for Private Fund Managers

Brian T. Daly and Joshua B. Wright - Schulte Roth & Zabel LLP

On Nov. 25, 2019, the Commodity Futures Trading Commission approved amendments that impact several registration and reporting exemptions, which will affect many hedge fund and private equity fund managers. While, in general, these are long-needed changes that streamline administrative processes or harmonise CFTC rules with those of other regulators or with actual market practice, every private fund manager relying on a CFTC exemption should review the details of the changes.


EMIR Update: Regulatory Margin and the Introduction of Benchmark Fall-backs in OTC Derivative Contracts

Judith Lawless, Adrian Farrell and Imelda Higgins - McCann FitzGerald

The European Supervisory Authorities (the “ESAs”) have published joint draft Regulatory Technical Standards (“RTS”) to amend Commission Delegated Regulation 2016/2251 (the “CDR”) on the risk mitigation techniques for non-cleared OTC derivatives including in respect of the phase-in of the regulatory initial margin requirements. As the deadlines and expiry of derogations the subject of the proposed amendments are fast approaching, and RTS need to go through various steps before being finalised and entering into force (endorsement by the European Commission and scrutiny and non-objection by the European Parliament and the Council), the ESAs have stated that they “expect competent authorities to apply the EU framework in a risk-based and proportionate manner until the amended RTS enter into force”.


FinSA and FinIA enter into effect on 1 January 2020 - But a lot of provisions do not apply immediately

Dr Matthias Kuert - CMS von Erlach Poncet AG

On 6 November 2019, the Swiss Federal Council decided that the Swiss Financial Services Act (FinSA) and the Swiss Financial Institutions Act (FinIA) will enter into effect on 1 January 2020. Concurrently, the final versions of the Financial Services Ordinance (FinSO) and the Financial Institutions Ordinance (FinIO) (as well as the Supervisory Organisation Ordinance (SOO)) containing the implementing provisions for FinSA and FinIA were published.