Equity sector hedge funds shine in a volatile 2020

As the performance figures roll in over the last two weeks of the year, the clear winner among hedge fund strategies are equity-oriented strategies. Asian equity managers have stolen the show though with numerous 40%-plus year-to-date returns, according to figures collected by HSBC. The Marshall Wace UCITS Funds -- MW Tops China was up 47.39% through November. The fund is a long biased 130/30 oriented offering. A second outlier is the Pinpoint China Fund, which was up 46.14% in 2020 through December 15. And lastly is MassAve Global Partners, which was up 45.59% through November. Database provider HFR reported that China funds on average were up 15% in 2020 through October. Meanwhile, eVestment estimated gains for China-focused funds of 18.45% through the same timeframe. Either way many equity hedge funds, especially those in China are on the upswing as market volatility too is on the rise. Dispersion remains high too among managers and their individual strategies. According to the most recent figures, some of the chart toppers are Pershing Square Holdings which was up over 66% in this year through December 15. Pivotal Path, which charts $2.3 trillion in hedge fund assets, found that through November hedge funds were up just over 7%, but equity sector funds topped the charts this year for performance and more importantly in delivering alpha. This was the story of 2019 too, but according to data provider Pivotal Path, the most hedge fund launches in 2020 through November were equity strategies accounting for 45% of all launches. Over the same time period in 2019, equity hedge funds accounted for only roughly one-third of all hedge fund launches. In November, all hedge fund strategies except equity quantitative (down 0.1%) were up, according to PivotalPath. The equity sector funds though were up 6.8%, which marks the best monthly return going back to 2000. For the rolling one-year period ending in November, equity funds are up 13.8%, officials added. By comparison, in 2019 equity strategies were up only 5%.

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