Hedge funds are battling
Performance over the past number of years has been lacklustre, writes Johann Barnard
It’s been a tough time for the local hedge fund industry, which has had to deal with net outflows of about R5bn in 2017. It follows a rigorous process of transition to the regulated collective investment scheme space that started in 2015.One reason for the change has been to attract retail investors who want to add more diversification to their portfolios through these alternative investment structures.The Association for Savings & Investment SA reported in April that this was the industry’s first decline in assets under management since 2011.There is general agreement that the reason for funds flowing out is lacklustre performance over the past number of years.Novare Investments’ Neil Verster says performance over the past year has favoured fixed income strategies rather than long-short equity ones. "Having said that, the latter, as well as market-neutral strategies, has protected capital in 2018, while the local equity market is down for the year to date. Manager performance withi...
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