After a dramatic increase in market volatility in May and June, very few hedge funds have seen positive returns in recent months - but those that did witnessed their largest increases since Lehman Brothers went under. According to the Financial Times, bearish hedge fund managers and their global macro funds, which bet on the shifting conditions of the global economy, have reported gains from short positions against the Eurozone’s sovereign credit, the Yen, the Euro, and “commodity currencies” like the Australian and Canadian dollars. Among the top performers were macro fund Autonomy Capital, which manages $1.7 billion under the leadership of Lehman veteran Robert Gibbins and is up 17% so far in 2010; BlueCrest Capital’s flagship $7 billion BlueCrest Capital International fund, which focuses on fixed income and is up over 10%; and GLG Partners’ macro fund, which manages $160 million and gained 8% in May alone. According to Dow Jones Newswires, global macro hedge fund Prologue Capital’s flagship fund, which now manages over $1 billion, has also reported 4% gains so far this year.
Among concerns over a slowdown of the economic recovery, high levels of unemployment, a deflationary scare and Europe’s sovereign credit mess, these bearish global macro managers seemed to have the only profitable portfolios. Other global macro funds like Brevan Howard, Moore Capital and Tudor Investment have all witnessed negative or mediocre returns so far, and on average macro funds have dropped 1.16% this year. According to Hedge Fund Research, hedge funds overall have dropped 0.21% on average year-to-date, and the analyst’s Weighted Composite Index was down 0.86% in June. |
