WEST PALM BEACH, FL (HEDGECO.NET) – A new poll conducted by LJH in conjunction with Reuters has revealed that hedge fund investors have changed tactics during the third quarter. This change intactics was aimed at improving returns in a year marked by lackluster performance. According to the new poll, investors are putting their money into more risky investment strategies.
Since July, the shift in strategies have become more obvious; emerging market strategies, currency and commodities have increasingly become new theaters of action. James Hedges, president and chief investment officer of LJH Global Investments, said, “The shift in preferences can be explained with investors’ desire to boost returns, because emerging market funds and certain commodities have been the year’s best performers, people are putting money there to chase returns,� Hedges explained.
Latest hedge fund returns for 2004 year-to-date provided by hedge fund tracker CSFB/Tremont shows that during the first nine months of 2004, hedge funds earned about 3.79%. This return was much lower than the double digit figures earned by hedge funds in previous years. According to CSFB/Tremont, emerging market hedge funds returned an average of 5.51 percent this year, while global macro funds have so far gained about 3.91 percent.
LJH data shows that hedge fund investors have walked away from strategies where little money was made, such as equity strategies. The equity hedge funds saw a gain of only $98 million in the third quarter, while these strategies gained $426.83 million in the second quarter. Although the poll shows that hedge funds took in less assets during the third quarter, it concluded on a note of optimism that demand for hedge fund products will likely increase in the coming months partly because the US presidential election is over.
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net
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