The benchmark Eurekahedge Hedge Fund Index was up 1.85% in August 2020 and up 3.79% year-to-date. Total assets under management increased by US$17.9 billion during the month – the sector witnessed performance-based gains of US9.6 billion while registering net asset inflows of US$8.3 billion. The total size of the industry now stands at US$2,181.4 billion.
The Eurekahedge Hedge Fund Index was up 1.85% in August, bringing its year-to-date return to 3.79% and its five-month trailing return to 12.85% since end-March. Hedge fund managers benefitted from the robust performance of the global equity market as represented by the MSCI ACWI (Local) which gained 5.54% over the month. Risk assets reacted positively to the encouraging development of the COVID-19 vaccine and improving macroeconomic data. In the US, the deceleration of the spread of COVID-19 and the Fed's announcement on adopting a new inflation framework that could keep its policy rate lower for a longer period boosted the region's equity market during the month.
The Eurekahedge Hedge Fund Index was up 1.85% in August, bringing its year-to-date return to 3.79% and its five-month trailing return to 12.85% since end-March. The robust performance of the global equity markets on the back of the encouraging development of the COVID-19 vaccine and improving macroeconomic data supported hedge fund managers' performance. In the US, the declining daily COVID-19 cases on top of the Fed's new inflation targeting framework boosted the region's equity market. The tech-heavy NASDAQ recorded the strongest return of 9.59%, while the S&P 500 was up 7.20% in August. The Fed shifted its approach to inflation to 'average inflation target' aiming to achieve an average inflation rate of two percent over time, which were expected to result in keeping the interest rates lower for an extended period.
The Eurekahedge Latin American Hedge Fund Index was up 0.21% as of July 2020 year-to-date, broadly outperforming the underlying equity market in the region as represented by the MSCI EM Latin America Index, which was down 13.59% over the same period. In 2019, Latin American fund managers gained 15.22%, outperforming their regional peers as the strong run of risk assets in the region supported the fund managers' performance throughout the year. However, risk aversion resurfaced in the first quarter of 2020 due to concern surrounding the spread of the coronavirus outside China.
Eurekahedge’s Latin American hedge funds infographic sums up the industry as at September 2020. Find out more about Latin 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.
Interest in the environmental, social and governance (ESG) policies of companies and their impact on the wider community has continued to increase amongst institutional investors, retail shareholders and the media during the first half of 2020. The COVID-19 pandemic and the Black Lives Matter movement have both resulted in the “S” in ESG becoming rapidly more important as companies seek to reaffirm their public image in response to such events, defying any concerns that ESG issues would fall to the wayside at the onset of an economic crisis. In this article, we review some of the key ESG developments and trends in the UK and Europe in the first half of 2020.