Hedge Funds Have Produced Worst Returns Then The U.S. Stock Market This Year


Demand for managed funds remains high especially among the smallest funds emerging as some of the best performers.

Funds with less than $1 billion in assets are benefiting from their more manageable portfolios.

London-based Alanda Capital Management Ltd. (manages less than $500 million) gained about 53% through November. Founder Christian Vogel-Claussen said his fund’s competitive edge comes from a concentrated portfolio built by data science and fundamental research.

“We want to be the nimble speedboat,” Mr. Vogel-Claussen said.

Requests for boutique managers rose 22% in the third quarter from a year earlier.

Accendo Capital, an activist investor with €140 million ($170 million) in assets showed returns of 41% as of November. It recently added five new investors and more than €10 million in new assets this year (Founder Henri Österlund said firm will stay below $500 million).

Caygan Capital, which manages around $500 million from London and Singapore, returned nearly 40% through November in one of its funds.

BlueBay Asset Management LLP with $219 million in assets was up 21% through November, partially from trading the debt of U.S. and other auto makers, said senior portfolio manager Geraud Charpin.

The Galton investment team at New York-based Mariner Investment Group LLC manages $868 million for a strategy that focuses on securitized products, it returned around 22% as of October.

As of Oct. 31, the most recent data available, funds with less than $250 million in assets returned 1.12%, according to research firm eVestment. That still put them ahead of the world’s 10 largest hedge funds, which were down 1.85%. Funds with more than $1 billion were down by 2%.

Over the same period, eVestment’s Hedge Fund Aggregate benchmark returned 0.74%, while the S&P 500 returned 2.77%. Including November, the S&P was up 14%.

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Economics, Finance and Investing