Interest Macro Hedge Funds Falling – At Exactly the Wrong Time?

May 31st, 2013
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Leave it to the dubious timing of investors to abandon an investment strategy just when the trends begin moving in its favor. As reported by Institutional Investors Alpha, data compiled by Prequin reveals that interest in macro funds continues to plummet at time when they are poised to outperform equity hedge funds.

As the stock market rally enters its fifth year, volatility has, once again, reared its head which has investors concerned over a possible 2011 repeat of a sharp correction. Historically, macro funds have performed better than the S&P 500 and equity funds during periods of volatility and general stock market declines. A comprehensive study conducted by fund-of-fund manager, Crystal Capital Partners, reveals an undeniable inverse relationship between stock market performance and the returns on macro funds over a ten year period, indicating that the place to be when anticipating a decline in equities is with macro funds.

The article notes how the only quarter during the study when macro hedge funds overall posted a loss was the dreadful 4th quarter of 2008, during which they fell by 2.6%, while the S&P 500 dropped by 22.6%. Despite the dire market conditions in 2008, Alan Howard’s Brevan Howard Master Fund was able to post a gain of 21%, while Bruce Kovner’s Caxton Global flagship gained nearly 13%.
For Detailed Investor Profiles on these Investors, click below:
Brevan Howard Asset Management
Caxton Associates
Related People: Aaron Rowe ; Alan Howard; Andrew Law; Bruce Kovner; Christopher Rochos; James Vernon; Jean-Phillipe Blodget; Trifon Natsis
Related Entities: BH Global; BH Macro; Brevan Howard Asia Fund; Brevan Howard Credit Catalysts; Brevan Howard Emerging Market Strategies Fund; Brevan Howard Macro FX; Brevan Howard Master Fund Ltd; Caxton Alpha Equity LLC; Caxton Associates; Caxton Equity Growth (BVI) Ltd; Caxton Global Investments USA LLC; Caxton Healthcare Trading LLC; Caxton International LTD; Swiss Reinsurance
Related Article Tags: Multi-Strategy, Long Short, Equity, Debt and Global Macro Hedge Fund News; Featured Reports

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