Hedge Funds’ YTD Performance By Strategy: HSBC

The 48th Hedge Weekly incorporating Investment Funds Performance Review by the HSBC Alternative Investment Group for the week ended November 29, 2013, presents a wealth of data on how funds performed in 2013 up to the date analyzed by strategy.

Hedge Funds’ YTD Performance By Strategy: HSBC

Average returns by strategy as per the report have been shown below in descending order of performance.

Fund TypeFund Category2013 YTD Returns %
Equity-EnergyEquity Long/Short32.75  *
Equity-Pharma-BiotechEquity Long/Short22.66
Equity-HealthcareEquity Long/Short21.55
Equity-DiversifiedEvent Driven20.87
Multi-StrategyEvent Driven20.05  **
CommodityManaged Futures15.16
Equity-DiversifiedEquity Long/Short15.02
Equity-Mid-Small CapEquity Long/Short14.7
Equity-FinancialEquity Long/Short13.83
Equity-Real EstateEquity Long/Short13.73
Equity-CommodityEquity Long/Short13.29
TradingFund of Funds9.94
Equity DiversifiedMarket Neutral9.22
Credit Long/ShortCredit Long/Short8.68
Event DrivenFund of Funds8.16
DiscretionaryMarket Neutral7.87
MacroFund of Funds7.86
Convertible ArbitrageConvertible Arbitrage7.85
Long/ShortFund of Funds7.21
SystematicMarket Neutral7.17
Multi-StrategyFund of Funds6.31
Equity-TechnologyEquity Long/Short4.86
Multi-StrategyMarket Neutral4.58
ArbitrageFund of Funds4.43
Equity-DiversifiedLong Only4.24
Fixed Income ArbitrageFixed Income Arbitrage3.52
Equity-UtilityEquity Long/Short3.21
Statistical ArbitrageMarket Neutral2.03
ArbitrageVolatility Arbitrage1.22
SystematicManaged Futures0.51
Fixed IncomeMacro-4.38
CurrencyManaged Futures-15.62

Hedge funds appear to be underperforming

It appears that hedge funds have underperformed the major market indices.

It’s also clear that within hedge funds, equity based funds are clustered at the top of the table, which is not surprising considering the stellar returns witnessed in the US, Europe and Japan.

The strategies showing negative returns are the Macros. Managed futures have a mixed performance appearing both at the top of the pecking order as well as the bottom.

Funds of note

Two funds of note have been marked with asterisks against their category:

*DORSET ENERGY FUND, LTD – CLASS A managed by David M. Knott, Donald Textor had assets of $271M and earned YTD returns of 32.75%. Its objectives are Investing Long / Short in energy and energy-related companies. Emphasis on established companies with a focus on North American exploration and production companies (E&P).

**SFP VALUE REALIZATION FUND managed by Greg McEntyre had $251M assets and earned YTD returns of 66.14%. It is a Tokyo-based hedge fund run by SFP that exploits market inefficiencies by investing in undervalued Japanese companies and implementing changes leading to share price appreciation over a two to four-year period.