It was a turbulent yet interesting year for the financial world with lots of global events driving investor sentiment ranging from; economic milestones like China declared as the worlds largest economy (according to IMF), Argentina’s default, Political issues like Modi’s victory in India, Scotland’s “NO” vote, geopolitical tensions in Europe and Asia, disasters, virus outbreaks, and of course the world cup (most unforgettable for Brazil’s disastrous 1-7 loss to Germany) and many more.
These occurrences in their own unique way have driven different markets in different patterns as emerging markets slumped and the S&P 500 breaking new highs.
AtoZ Forex takes a quick peak at how hedge funds around the world have performed amidst the good, the bad and the ugly cycle of 2014. We highlight the best performing Hedge funds as of October 31st (according to bloomberg markets).
|Fund, Manager||Management firm, Location||Strategy||Assets in Billion$||2013 returns||2014 returns|
|Pershing Square International—Bill Ackman||Pershing Square Capital Mgmt, U.S||Activist||6.1||9.3%||32.8%|
|Quantedge Global- Team managed||Quantedge Capital, Singapore||Quantative||1.0||9.2%||32.3%|
|STS Partners- Michael Craig-Scheckman, Scott burg||Deer park road, US||Asset backed||1.3||25.6%||23.9%|
|Hilldene Oppurtunities-Brett Jefferson||Hildene Capital mgt, U.S||Structured credit||1.3||35.3%||23.6%|
|AHL Diversified-Tim Wong,Mathew Sargaison||AHL Partners, UK||Managed Futures||4.4||-3.1%||21.1%|
Pershing Square Capital Mgt, U.S
Founded and run by Bill Ackman, Pershing Square Capital is famous for its Activist hedge fund investment strategy. Starting out with just $54 million in 2004, it is has grown to a worth of about $6.1 billion. Most notable of its activities is Bill Ackman’s highly publicized rift with fellow activist investor, Carl Ichan over Herbalife, a nutritional supplements company which Ackman refers to as a mere "pyramid scheme", as his firm made a $1 billion short bet on the company with Carl Ichan on the other side. Ichan once referred to the situation as the “mother of all short squeezes” as other notable investors like George Soros also joined the long side of the trade. The Herbalife trade has though worked out well for Ackman this year.
Quantedge Capital, Singapore
As of June 2014, the firm was managing over US$1 billion under its flagship Quantedge Global Fund primarily on behalf of high net worth individuals, family offices and institution. Quantedge adopts a systematic investment strategy that employs statistical models to pick trades across major macro asset classes such as bonds, equities, commodities and currencies. The fund has an investment universe of 180 instruments and typically invests in about 90% of these instruments with no more than 5% allocation to a single instrument. Hence, the portfolio is exceedingly diversified, as the managers believe that "ultra-diversification" helps to enhance the overall portfolio's risk-adjusted returns.
Deer park road, US
Deer Park Road Corporation is a multi-fund investment manager focused exclusively on investing in distressed real estate and asset backed fixed-income securities for both high net worth individuals and institutional investors. In May 2008 the firm established the STS Partners Fund, LP and has managed this investment portfolio since, as they continue to exclusively on distressed asset-backed securities as they have done since June 2003.
Hildene Capital mgt, US
Hildene Capital Management is a hedge fund launched in 2008 to capitalize on distressed opportunities in structured credit. Brett Jefferson, Hildene's President, established one of the first and most successful distressed structured credit platforms while he was Portfolio Manager for the Marathon Structured Finance Fund (2002-2006). Hildene's current fund has a primary focus of investing in financial trust preferred securitizations which are effectively pools of deferrable debt issued by mostly private, small and regional U.S. banks and insurance companies. Hildene's investment is not on an equity valuation of a particular bank but rather on various pools of banks' abilities to make good on their trust preferred obligations.
AHL Partners, UK
Since its formation in 1987, AHL has focused on identifying trends and other inefficiencies through statistical analysis or market behaviors. This is used to develop systematic trading models designed to profit from such opportunities wherever they arise. AHL's investment process is built on a belief that markets frequently demonstrate inefficiencies that can be predicted through careful statistical analysis.