Hedge funds down 1.2% in January

By Staff | February 16, 2016 | Last updated on February 16, 2016
2 min read

January was not a happy start to the year for hedge funds, as managers witnessed a drag in performance — down 1.20% during the month. Investor panic induced strong downward pressure on equity markets leading to a sell-off and the resulting capital flight to safe havens. The MSCI World Index declined 5.71% over the same period, with much of the weakness in the global equity markets being led by Asia.

Here are some key highlights from the Eurekahedge report.

  • Asian managers posted their weakest returns since August last year, with Greater China mandated funds down 5.76% in January while Japan dedicated funds lost 2.71%. The Asian hedge fund space expanded by US$10.7 billion in 2015 through a combination of investor flows and performance-based gains.
  • Event driven hedge funds posted the worst returns among all hedge fund strategic mandates, down 3.56% in January. North American and European event driven managers were down 5.36% and 3.14% respectively while Asian managers posted losses of 4.65% in what is turning out to be the worst month for the strategy since 2011.
  • The European hedge funds sector registered the strongest growth in AUM among all regional mandates in 2015, growing their asset base by almost 10% during the year to US$535 billion. Investor allocations to the region stood at US$ 40.5 billion, a year-on-year increase of 110%.
  • CTA/managed futures, tail-risk and long volatility were the only strategies to end the month in green with returns coming in at 2.32%, 3.53% and 2.59% respectively.
  • The US$80.9 billion Islamic funds industry managed to outperform the Dow Jones Islamic World Index in 2015, despite a very challenging market environment that saw a spike in investor redemptions as oil dependent economies in the Middle East call down capital in the face of worsening budget deficits.
Advisor.ca staff


The staff of Advisor.ca have been covering news for financial advisors since 1998.