Bringing you live news and features since 2006 

Anthony Lawler, Head of Portfolio Management at Man’s multi manager business

Comment: Risk appetite returns in September

RELATED TOPICS​

Hedge fund managers increased their appetite for risk in September following signals that the Federal Reserve will vote to take additional quantitative easing measures, according to Anthony Lawler, Head of Portfolio Management at Man’s multi manager business.

The move into risky assets such as emerging market equities, FX and commodities led to a positive month’s performance in September for most hedge funds.
 
Managers’ moves to increase risk in September were typical of a volatile 2010. After giving back much of July’s gains in August, equity markets rallied again in September as bearish economic indicators gave way to renewed optimism that looser monetary policy will drive prices higher. It was far from a smooth ride though – with significant intra-month reversals creating challenging trading conditions.
 
“Risk appetite returned to the markets with a vengeance this month," says Lawler. "Hedge funds, on the whole, put up strong numbers and we continue to believe that well managed portfolios of hedge funds will deliver an attractive long-run return pattern.”
 
Global macro and managed futures funds performed well, benefiting from strong moves in FX, gold, industrial metals and emerging markets equity ex-Japan. Managers profited in particular from short dollar and long commodity-linked currency positions. Event driven and relative value made flatter contributions this month. Long/short equity strategies contributed strongly to performance but did not fully participate in the market’s rally.

Other key conclusions from Man’s research include:
 
Long/ short equity returns were marked by significant dispersion with the strongest moves to the upside generated in the Emerging Markets/Asia. Managers focused in Japan saw subdued trading following intervention in the currency markets from the Bank of Japan. Man continues to believe that the markets favour more tactical traders who can quickly adjust net and gross exposures as conditions require

Managed futures performed well given the significant momentum across most futures markets particularly in FX and industrial metals. September was marked by sharp reversals which led to more mixed returns from short-term traders.
 
Lawler adds: “Macro managers performed well in September and it was the second consecutive month of solid returns from managed futures managers, as momentum strategies exploited trending across futures markets.

“We continue to look to the FOMC meeting on 3 November for further quantitative easing from the Fed and the market is already discounting this expectation. Government intervention can significantly impact market prices and lead to trading opportunities as well as risks.

“In this environment, we continue to favour a balanced approach to hedge fund strategies with a focus on proven nimble, tactical traders.”

Latest News

Saving and investing app, Moneybox, has doubled the number of ETFs available on the platform, in the light of ‘growing..
Global X ETFs has announced the appointment of Ryan O'Connor as its Chief Executive Officer effective as of April 8, 2024. ..
Value-driven structured credit investing firm, Angel Oak Capital Advisors, LLC, has announced the completed conversions of two of its mutual..
Confidence in the continuing strength of bitcoin and Ethereum is driving wider interest in altcoins and other digital assets, according..

Related Articles

Frank Koudelka, State Street Global Services
ETF data provider and ETF Express data partner, Trackinsight, has published its Global ETF Survey 2024 Report: ‘50+ Charts on...
Cryptocurrencies
Matteo Greco, Research Analyst at Fineqia International writes that bitcoin (BTC) ended the week at approximately USD52,150, showing a notable...
US Distribution Awards trophies
The winners of the first US ETF Distribution Awards at the Exchange conference, hosted by ETF Express and sponsored by...
Thomas Bonville, Clear Street
Just over a year ago, Thomas Bonville joined New York-based, prime brokerage Clear Street as managing director, head of derivative...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by