Global Stock Markets
A group of prominent hedge funds have roared back with market-trouncing
returns in 2017, helping the industry score its best performance in at
least four years in a surprise rebound for an often maligned pocket of
Wall Street.
An elite club of managers rode bull markets and increased dispersion between securities to score profits of at least 20 percent through the end of October, a dramatic improvement from last year for investors such as Larry Robbins, Philippe Laffont and Chase Coleman, people familiar with individual funds’ performance said.
By comparison, the S&P 500 Index was up 15 percent, more than double the benchmark HFRI hedge fund index, which was up 7.23 percent through October, its best annual return since at least 2013.
The last few years have been littered with hedge fund managers who charged steep fees and often promised heady returns only to lose money for investors or close shop entirely. A roaring stock market and the rise of low-cost investment tools, such as index funds, have also hit the industry.
An elite club of managers rode bull markets and increased dispersion between securities to score profits of at least 20 percent through the end of October, a dramatic improvement from last year for investors such as Larry Robbins, Philippe Laffont and Chase Coleman, people familiar with individual funds’ performance said.
One
of the largest returns came from Charlottesville-based investor Jaffray
Woodriff, who used short-term stock bets to score a 68.3 percent gain
in a key fund of his $4 billion Quantitative Investment Management.
By comparison, the S&P 500 Index was up 15 percent, more than double the benchmark HFRI hedge fund index, which was up 7.23 percent through October, its best annual return since at least 2013.
The last few years have been littered with hedge fund managers who charged steep fees and often promised heady returns only to lose money for investors or close shop entirely. A roaring stock market and the rise of low-cost investment tools, such as index funds, have also hit the industry.
Still, the mega winners
this year offer some hope for investors and managers who believe the
industry can produce “alpha,” or returns above the market’s “beta.”
The
main fund managed by Robbins’ $11.7 billion Glenview Capital Management
LLC is up 21 percent so far this year, thanks to positions in
healthcare technology provider IQVIA Holdings Inc (Q.N), health insurer Anthem Inc (ANTM.N) and chemical manufacturer FMC Corp (FMC.N),
according to a public disclosure of top stock holdings and a person
familiar with the returns. Like others, the person requested anonymity
to discuss private information about the fund.
Robbins,
a New York-based billionaire, lost money for investors in both 2015 and
2016, according to a report by HSBC Alternative Investment Group.
Coleman and Laffont relied on technology companies to drive outsized gains.
The main fund managed by Coleman’s $20 billion
Tiger Global Management LLC gained 34.5 percent through October, due
partly to investments in Chinese internet companies Alibaba Group
Holding Ltd (BABA.N) and JD.com Inc (JD.O), a second person familiar with his performance said.
The main fund in Laffont’s $12 billion Coatue Management LLC rose 29.3 percent, helped by positions in Facebook Inc (FB.O) and Shopify Inc (SHOP.TO), a third person said.
Coleman’s main hedge fund lost money in 2016, while Laffont’s produced a small positive return, according to media reports.
Other funds benefited from investments in emerging markets, people familiar with them said.
An
Argentina-focused fund managed by $1.5 billion Bienville Capital
Management gained 40.6 percent through October, while the oldest fund
within $3.4 billion Toscafund Asset Management LLP gained 28.8 percent,
helped by bets on financial companies in Portugal, Spain and Russia.
No comments:
Post a Comment