Hedge Funds See Fourth Consecutive Month of Positive Returns in April

13 May

Hedge Funds See Fourth Consecutive Month of Positive Returns in April

Hedge funds gained an average of +1.26% in April, the fourth consecutive month of positive returns, following a five-month string of aggregate declines closing out 2018, according to the just-released eVestment April 2019 hedge fund performance data. Year to date (YTD) 2019 industry average gains of +6.52% lag a global balanced benchmark but represent the industry’s best first four months since 2006, when aggregate gains were +7.62%.

Among primary strategies, Event Driven – Activist strategies were big winners in April and YTD 2019, returning an average of +2.79% last month and +9.94% so far this year. This is a noticeable turnaround from 2018, when Event Driven – Activist funds were deep in the red at -10.30%.

Other interesting highlights from the new data include:

  • Managed futures funds again produced big gains in April, returning an average of +2.03%, bringing Q1 2019 returns to +4.66%. The group still has a way to go to offset 2018 average losses of -6.06%. The 10 largest funds in the space returned an average of +3.02% in April and are +6.77% YTD.
  • Long/Short Equity funds were another big winner in April, returning +1.79% last month and +9.84% YTD. As with Event Driven – Activist funds, Long/Short Equity funds are seeing a marked turnaround from their -7.03% performance in 2018.
  • Russia-focused funds gained the most of any emerging markets segment in April, returning an average of +2.61%, bringing YTD returns to 11.10%.
  • China-focused funds underwhelmed in April with +0.74% returns, but continue to be the industry’s best performing segment overall in 2019 with average YTD gains of +18.55%.

The full eVestment hedge fund performance data for April is below.

Industry Benchmarks Apr YTD 2019 2018 2017
Hedge Fund Aggregate 1.26% 6.52% -5.09% 8.94%
50% MSCI World/50% Citi WGBI 1.52% 8.68% -4.60% 14.75%
S&P 500 4.05% 18.25% -4.38% 21.83%
Primary Markets Apr YTD 2019 2018 2017
Broad Financial Derivatives 1.80% 3.97% -5.52% 2.44%
Equity 1.53% 8.95% -7.52% 13.45%
Broad Multi-Market 1.28% 4.21% -3.83% 4.50%
Broad Capital Structure 0.97% 6.13% -3.44% 8.90%
Fixed Income/Credit 0.78% 3.63% 0.01% 6.04%
Volatility/Options Strategies 0.46% 2.89% -2.40% 4.81%
FX/Currency 0.24% 0.54% 0.76% -3.46%
Commodities -0.60% 2.19% -6.00% 0.46%
Primary Strategy Apr YTD 2019 2018 2017
Event Driven – Activist 2.79% 9.94% -10.30% 10.89%
Managed Futures 2.03% 4.66% -6.06% 2.75%
Long/Short Equity 1.79% 9.84% -7.03% 12.14%
Distressed 1.51% 4.89% -0.31% 6.64%
Quantitative Directional Equity 1.30% 5.15% -4.73% 10.45%
Convertible Arbitrage 1.09% 5.99% -2.22% 5.71%
Event Driven 1.06% 4.94% -1.94% 7.42%
Macro 1.05% 3.24% -2.93% 4.03%
Multi-Strategy 1.01% 4.48% -3.38% 6.90%
Directional Credit 0.97% 3.70% 0.67% 5.32%
Origination & Financing 0.88% 3.13% 4.99% 6.69%
Relative Value Credit 0.74% 3.45% -0.98% 5.48%
Multi-Strategy Credit 0.71% 3.17% 0.03% 5.70%
Market Neutral Equity -1.04% -0.23% -3.21% 3.58%
Prominent Universes by Size Apr YTD 2019 2018 2017
Ten Largest Hedge Funds 1.48% 3.78% 2.36% 5.03%
Ten Largest Long/Short Equity 1.31% 4.65% -3.81% 8.54%
Ten Largest Macro 0.49% 2.25% 2.13% 2.24%
Ten Largest Managed Futures 3.02% 6.77% -7.48% 3.86%
Ten Largest Multi-Strategy 0.41% 3.23% -2.57% 6.40%
Economic Development Mar YTD 2019 2018 2017
Emerging Markets 0.68% 8.22% -10.84% 19.55%
Country Exposure Apr YTD 2019 2018 2017
Russia 2.61% 11.10% -13.20% 13.17%
Japan 1.01% 3.09% -8.02% 13.77%
China 0.74% 18.55% -16.63% 34.76%
Brazil 0.49% 4.02% -2.26% 15.13%
Asia ex-Japan 0.22% 6.91% -11.33% 21.76%
India -1.60% 1.57% -16.23% 32.87%

Learn how eVestment can help your firm.