Hedge Fund Focus: June 24, 2016
The entire week was engulfed in speculation over which way the UK would vote on Brexit and unfortunately we awoke Friday morning to unsettling news that Britain had decided to secede from the European Union. Needless to say, in light of this unexpected outcome, all other news this week paled in comparison. In order to cut through the swirl, here are the stories we think are best to read about the matter as it pertains to the industry:
- The Times’ piece on how the decision reflects how divided the UK is
- The FT’s thoughts on the decision’s impact on the asset management industry
- What Jamie Dimon expects to happen as a result of the vote’s outcome
- NYT DealBook’s and IPE’s pieces on the market turbulence resulting from the decision
- HFMWeek views the decision’s effect on industry regulations
In other news…
- With uncertainty around Brexit and the Fed raising rates, we once again saw mixed reports this week on how the industry is doing. Going into the week HFR had hedge funds up 0.39 percent through mid-month but Lyxor had the industry down 0.8 percent. Either way event-driven strategies are leading the pack
- Despite the overall rebound, Och-Ziff and Third Point as well as macro, long-short and credit strategies continue to suffer losses
- Additionally, many managers are still dealing with the fallout from last year and struggling to reach their high water marks, and redemption requests increased for the third straight month in June
- There was also a lot of focus this week on institutional investors’ alternative investments with consultant McKinsey reporting large pension and sovereign wealth funds are looking at portfolio construction over alpha when evaluating managers and Markov Processes International (MPI) cautioning investors not to be too quick to exit their hedge fund investments
Quick Things to Know:
- Barron’s released its annual 100 Best Performing Hedge Funds Ranking, finding many winners are not household names
- Institutional Investor released the winners of its annual Hedge Fund Industry Awards
- Brevan Howard co-founder and COO James Vernon stepped down to a non-executive role at the firm
- And several of Steve Cohen’s deputies are quitting Point72 to run his new hedge fund