Asia Ex-Japan Leads With 6.94% YTD As Hedge Funds End Losing Streak by Eurekahedge

Hedge funds reversed their four month losing streak with the Eurekahedge Hedge Fund Index up 1.33%1 in October while the MSCI World Index2 climbed 7.22% during the month. On a year-to-date basis, hedge funds are up 1.77% while underlying markets as represented by the MSCI World have gained 1.40%.

October was dominated by resurgence in equity markets across the board as investor sentiment showed signs of improvement, helped largely by accommodating views aired by key central banks. The ECB and BOJ in particular remain dovish, reiterating their intent to meet their inflation targets as part of their broader strategy to support growth in their respective economies. On the other hand, the Fed appears to be hinting at a long overdue rate hike in December which seems likely given the encouraging employment numbers coming out from the US as well as the stabilizing outlook overseas – mainly China which appears to have weathered the worst for the moment. B?

Key takeaways for the month of October 2015:

  • On a year-to-date basis, hedge funds are up 1.77%, which compares with a gain of 3.52% seen over the same period last year.
  • Total industry AUM has increased by US$95 billion as of October 2015 YTD, almost US$10 billion lower compared to the same period last year. However, capital inflows have accounted for almost 73% of this growth as net investor flows for the year stand at US$70 billion in comparison to US$50 billion over the same period last year
  • Among developed market investment mandates, Japanese and European managers lead with year-to-date gains of 4.93% and 4.19% respectively, while North American hedge funds trail behind with gains of 0.52%.
  • Greater China investing hedge funds were up 4.84% in October and 8.86% year-to-date, outperforming the CSI 300 Index by almost 9%.
  • On a year-to-date basis, distressed debt funds have posted the worst return among all hedge fund strategic mandates, down 3.13% and are on track to post their worst performance since 2008.
  • Asia ex-Japan hedge funds were up 3.13% in October and 6.94% year-to-date – the best return among all hedge fund regional investment mandates. In comparison, the MSCI AC Asia ex Japan is down 3.84% year-to-date.
Main Indices Oct 20151 Last 3 Months 2015 Returns 2014 Returns Annualised Returns Constituents Weighting
Eurekahedge Hedge Fund Index 1.33 -1.41 1.77 4.56 9.20% 2,931 Equal
Eurekahedge 50 0.60 -1.90 0.33 3.04 5.73% 50 Equal
Eurekahedge Long Short Equities Hedge Fund Index 2.53 -1.73 3.32 3.48 8.93% 1,156 Equal
Eurekahedge Greater China Hedge Fund Index 4.84 -0.97 8.86 7.60 15.91% 79 Equal
Index of the Month Oct 20151 Last 3 Months 2015 Returns 2014 Returns Annualised Returns Constituents Weighting
CBOE Eurekahedge Relative Value Volatility Hedge Fund Index 1.65 0.34 5.36 -0.36 10.11% 41 Equal

Main Indices

Eurekahedge Main Indices Oct 20151 2015 Returns 2014 Returns
Eurekahedge Hedge Fund Index 1.33 1.77 4.56
Eurekahedge Fund of Funds Index 3.32 2.67 3.45
Eurekahedge Long-only Absolute Return Fund Index 4.87 -0.53 3.50
Eurekahedge Islamic Fund Index 2.54 -0.17 2.62

Regional Indices

All regional mandates ended October in positive territory with Eastern Europe & Russia mandated funds witnessing the largest gains. The Eurekahedge Eastern Europe and Russia Hedge Fund Index was up 4.41% during the month as underlying markets posted strong gains with the RTS Index gaining 7.07% during the month. Asia ex-Japan investing funds were up 3.13%, while the MSCI AC Asia ex Japan Index gained 5.78%. On a year-to-date basis, the Eurekahedge Asia ex Japan Hedge Fund Index is up 6.94%, the highest gains among all regional mandates and an outperformance of almost 11% relative to the underlying markets represented by the MSCI Asia ex Japan Index. The Eurekahedge Greater China Hedge Fund Index continued its recovery posting its second consecutive month of gains and was up 4.84% in October with underlying Chinese equity markets posting strong double digit gains as they bounced back from their August lows. On a year-to-date basis, Greater China investing hedge funds have preserved their gains from earlier during the year and are up 8.86%, outperforming the CSI 300 Index by almost 9%. Within the developed market mandates, North American hedge funds posted the strongest gains, up 1.94% followed by European mandates up 1.38% while Japan dedicated funds came in a close third with gains of 1.30%.

Eurekahedge Regional Indices Oct 20151 2015 Returns 2014 Returns
Eurekahedge North American Hedge Fund Index 1.94 0.52 5.44
Eurekahedge European Hedge Fund Index 1.38 4.19 0.67
Eurekahedge Eastern Europe & Russia Hedge Fund Index 4.41 2.97 -23.89
Eurekahedge Japan Hedge Fund Index 1.30 4.93 5.76
Eurekahedge Emerging Markets Hedge Fund Index 2.81 3.54 3.54
Eurekahedge Asia ex Japan Hedge Fund Index 3.13 6.94 9.06
Eurekahedge Latin American Hedge Fund Index 1.76 1.15 2.19

Strategy Indices

All strategic mandates, with the exception of CTA/managed futures ended the month of October in positive territory. Event driven managers posted the strongest returns among all hedge fund strategies, gaining 2.66% following four consecutive months of losses as a pick-up in global M&A activity in key sectors such as healthcare and technology helped managers??portfolios. Long/short equities funds were up 2.53% in October as global equity markets posted a strong recovery, with strong gains realized across both emerging and developed market mandated equity strategies. CTA/managed futures strategies, which had earlier posted gains in September, were down 0.99%, with trend following strategies posting losses on average down 0.86%. On a year-to-date basis, distressed debt funds have posted the worst return among all hedge fund strategic mandates, down 3.13%, followed by CTA/managed futures strategies at -0.93%.

Eurekahedge Strategy Indices Oct 20151 2015 Returns 2014 Returns
Eurekahedge Arbitrage Hedge Fund Index 1.83 5.52 2.71
Eurekahedge CTA/Managed Futures Hedge Fund Index -0.99 -0.93 9.21
Eurekahedge Distressed Debt Hedge Fund Index 0.23 -3.13 0.79
Eurekahedge Event Driven Hedge Fund Index 2.66 -0.23 2.53
Eurekahedge Fixed Income Hedge Fund Index 2.11 1.97 3.61
Eurekahedge Long Short Equities Hedge Fund Index 2.53 3.32 3.48
Eurekahedge Macro Hedge Fund Index 0.99 1.52 4.19
Eurekahedge Multi-Strategy Hedge Fund Index 1.16 2.04 4.56
Eurekahedge Relative Value Hedge Fund Index 0.21 1.46 3.85
CBOE Eurekahedge Long Volatility Hedge Fund Index 0.66 2.18 1.58
CBOE Eurekahedge Relative Value Volatility Hedge Fund Index 1.65 5.36 -0.36
CBOE Eurekahedge Short Volatility Hedge Fund Index 2.43 3.21 4.47
CBOE Eurekahedge Tail Risk Hedge Fund Index 2.34 -0.89 -3.22

 

Eurekahedge Global Hedge Fund Indices by Fund Size Oct 20151 2015 Returns 2014 Returns
Eurekahedge Small Hedge Fund Index (< US$100m) 1.41 1.40 4.38
Eurekahedge Medium Hedge Fund Index (US$100m – US$500m) 1.30 2.96 4.64
Eurekahedge Large Hedge Fund Index (> US$500m) 0.53 2.32 5.29
Eurekahedge Billion Dollar Hedge Fund Index 0.35 1.58 4.75

 

Mizuho-Eurekahedge Indices Oct 20151 2015 Returns 2014 Returns
Mizuho-Eurekahedge Index – USD 0.56 -0.13 1.18
Mizuho-Eurekahedge TOP 100 Index – USD 0.32 1.08 2.32
Mizuho-Eurekahedge TOP 300 Index – USD 0.37 0.40 1.77

 

Asia-Eurekahedge Indices Oct 20151 2015 Returns 2014 Returns
Eurekahedge Greater China Hedge Fund Index 4.84 8.86 7.60
Eurekahedge India Hedge Fund Index 0.68 3.63 38.84

* Based on 40.98% of funds which have reported October 2015 returns as at 11 November 2015

Click here to download our daily indices for free. Our indices are updated with the latest fund returns at 23:30 GMT every day and we encourage you to use them to benchmark your portfolio or fund performance. If you would like us to create a bespoke index for you, please let us know

1 Based on 40.98% of funds which have reported October 2015 returns as at 11 November 2015

2 MSCI AC World Index (Local)