Hedge Funds Gain 11.08 Percent In 2013

By ExpatBriefing.com Editorial 03 February, 2014

Hedge funds made gains of 11.08 percent in the 12-month period ending December 31, 2013, ahead of the 10.13 percent returned in 2012 and the benchmark loss of 1.93 percent in 2011, according to British research and consultancy firm Preqin.

Investors are largely satisfied with the performance in 2013. Eighty-four percent of investors interviewed for the 2014 Preqin Global Hedge Fund Report stated that returns expectations had been met or exceeded. 21 percent of investors stated returns expectations had been exceeded, the highest level since Preqin started collecting this data in 2008.

Preqin's report shows that funds of funds posted their highest net returns since 2009, gaining 7.72 percent in 2013. Macro strategies, however, had the worst returns, adding just 2.42 percent in 2013.

Emerging market funds performed poorly compared to counterparts targeting global and developed markets and in contrast to 2012, Preqin found. Emerging market funds posted returns of 5.86 percent in 2013, compared to gains of more than 12 percent in 2012.

Asia-Pacific-focused funds made gains of 16.73 percent in 2013, followed by North America funds (16.55 percent) and Europe funds (13.55 percent).

"Much of the recent criticism faced by hedge funds has focused on hedge fund benchmarks being outperformed by leading equity indices, such as the S&P 500," Amy Bensted, Head of Hedge Fund Products at Preqin, noted. "In 2013, the Preqin Hedge Fund Index, a benchmark of average hedge fund returns, again lagged the S&P 500; however, despite this, investors are satisfied with the performance of hedge funds in 2013. Investors are now looking beyond absolute returns; they are also looking for funds to produce strong risk-adjusted returns with low volatility on a consistent basis. The performance of hedge funds over 2012 and 2013 has certainly delivered this."

Tags: Investment | Investment Funds | Hedge Funds | Expats | Europe | Asia-Pacific | Invest | North America |


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