Hedge funds post mediocre first-half performance with some big names only up single digits

by | Jul 9, 2024 | Financial

So far this year, hedge fund managers have failed to beat the S & P 500 , one of the cheapest, easily available investment vehicles for ordinary investors. Hedge funds returned just 5% in the first half of the year after a 0.2% loss in June, with event-driven strategies the biggest laggards, according to data firm HFR. In comparison, the S & P 500 climbed 15% through June this year, marking one of its best first halfs. “With the first half of 2024 coming to a close, hedge funds across most strategies continue to show gains in the mid-to-high single-digits,” Morgan Stanley’s team including Bill Meany wrote in a July 1 note to clients. “The last six to eight weeks have been more challenging from an alpha perspective.” Americas-based long-short hedge funds gained just 40 basis points in June, implying that they only captured 10% of the upside relative to their benchmark S & P 500, according to Morgan Stanley. A basis point equals one one-hundredth of a percent (0.01%). The performance may come as a disappointment as hedge funds often tout star stock pickers and niche strategies to justify their high fees. Hedge funds typically charge a 2% management fee on the total assets under management plus a performance fee of 20% of the fund’s profits. Goldman Sachs’ prime brokerage data showed hedge funds have been …

Article Attribution | Read More at Article Source

[mwai_chat context=”Let’s have a discussion about this article:nnSo far this year, hedge fund managers have failed to beat the S & P 500 , one of the cheapest, easily available investment vehicles for ordinary investors. Hedge funds returned just 5% in the first half of the year after a 0.2% loss in June, with event-driven strategies the biggest laggards, according to data firm HFR. In comparison, the S & P 500 climbed 15% through June this year, marking one of its best first halfs. “With the first half of 2024 coming to a close, hedge funds across most strategies continue to show gains in the mid-to-high single-digits,” Morgan Stanley’s team including Bill Meany wrote in a July 1 note to clients. “The last six to eight weeks have been more challenging from an alpha perspective.” Americas-based long-short hedge funds gained just 40 basis points in June, implying that they only captured 10% of the upside relative to their benchmark S & P 500, according to Morgan Stanley. A basis point equals one one-hundredth of a percent (0.01%). The performance may come as a disappointment as hedge funds often tout star stock pickers and niche strategies to justify their high fees. Hedge funds typically charge a 2% management fee on the total assets under management plus a performance fee of 20% of the fund’s profits. Goldman Sachs’ prime brokerage data showed hedge funds have been …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]
Share This