Emerging markets deliver over the past 10 years
Although emerging markets recorded moderate results compared to other hedge fund strategies in January 2011, they have delivered the best average return over the past decade.
According to figures released by the Edhec Risk Institute, emerging markets annual average return since January 2001 was 12.3 per cent, followed closely by distressed securities and event driven strategies on 11.4 per cent and 8.8 per cent respectively.
Convertible arbitrage, distressed securities and fixed income arbitrage delivered the best results in January.
“Sustained both by risky bonds and the increasing credit spread, the convertible arbitrage strategy (1.90 per cent) bettered its profits of December," the Edhec Risk Institute analysis said.
“Conversely, the CTA Global strategy (-0.73 per cent) stumbled unexpectedly despite a sharp decline in the dollar and the rising trend of the commodity market,” the report added.
However, the worst performing strategy last month, as well as over the past decade, was short selling, with a January return of negative 0.86 per cent.
Aside from short selling, global macro strategies also delivered poor results last month.
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