Almost all hedge fund strategies generated positive returns in May, making it the seventh month in a row that the alternative asset has produced a positive performance, according to research by Preqin Ltd.

The data and intelligence agency’s benchmark, which measures all types of hedge funds, returned almost 0.3 per cent in May. And while that number is a dip from the 0.8 per cent return in April, the net return from the past 12 months has been positive at 10.3 per cent.

“Hedge fund performance has continued to make ground in May, despite some concerns about slowing growth in the U.S. and Europe,” said Amy Bensted, head of hedge fund products at Preqin, in a release. “There have only been three months since the start of 2016 in which hedge funds saw losses, and this should bolster investor confidence in the asset class.”

Read: Have institutional investors lost faith in hedge funds?

Many investors have been wary of hedge funds and, at the end of the first half of 2016, most didn’t expect their performance to improve in the next 12 months, noted Bensted. But while the industry has exceeded expectations in the past year, returns varied among the different types of hedge funds in May. Preqin’s report showed multi-strategy and event-driven hedge funds performed the best by returning 1.4 per cent and 0.5 per cent, respectively.

Read: Can alternative risk premia boost the outcomes of diversified growth funds?

Funds focused on Europe and the Asia-Pacific both gained 1.1 per cent. Those focused on North America, however, posted losses of 0.2 per cent. Medium-sized hedge funds ranging from $500 million to $999 million outperformed other fund sizes by returning 0.8 per cent.

“Fund managers will be looking to capitalize on this momentum to show investors the value of hedge funds in providing downside risk protection and the potential for returns,” said Bensted.

Copyright © 2017 Transcontinental Media G.P. Originally published on benefitscanada.com

Add a comment

Have your say on this topic! Comments that are thought to be disrespectful or offensive may be removed by our Benefits Canada admins. Thanks!

* These fields are required.
Field required
Field required
Field required

*