Hedge funds outperform stocks and bonds
Hedge funds have produced more consistent returns than equities or bonds over both the short and long term, according to joint research by alternative investment manager the Alternative Investment Management Association (AIMA) and data provider Preqin.
The report, that looked at the returns of more than 2,300 funds, found that hedge funds outperformed equities and bonds on a risk-adjusted basis over one, three, five and 10-year periods.
The value of hedge fund performance gains in 2017 stood at around of $250 billion and about 32 per cent of all hedge funds produced double digit returns in 2017, which represented a 23 per cent growth from 2016.
AIMA’s chief executive, Jack Inglis said: “We already knew that 2017 was a good year for hedge funds, with 11 per cent returns for the average fund and gains in every month of the year.
“But this new research makes an important contribution to the debate about hedge fund performance over the long-term since it shows that hedge funds have produced consistent and competitive returns for the last 10 years,” he said.
“This of course helps to explain why the industry has consistently expanded and attracted new investor capital since the global financial crisis.”
Amy Bensted, Preqin’s head of hedge funds, stressed that hedge funds managed to become an important part of institutional portfolios since the global financial crisis (GFC) and proved their value since then within the portfolios of investors such as pension funds, endowments, sovereign wealth funds and institutions.
AUTHOR
Oksana Patron
Recommended for you
Selfwealth has provided an update on the status of its scheme implementation deed with Bell Financial Group as well as whether rival bidder Svava remains in the picture.
Magellan Financial Group has reported its first half FY25 results while appointing a new chief financial officer and promoting Sophia Rahmani to chief executive.
Schroders Australia has launched two active ETFs and plans to further expand its listed range over the year ahead.
Platform Netwealth has reported its financial results for the first half of FY25, reporting an 80 per cent increase in net flows, with its CEO viewing a “huge opportunity” from private assets.
