News & Events

Hedge Fund Performance Commentary

The Eurekahedge Hedge Fund Index was up 4.03%1 in April – registering its best month since May 2009, supported by the robust performance of the underlying global equity market as represented by the MSCI ACWI IMI (Local) which gained 10.47% over the month. Global equities recouped some of the losses they suffered in March on the back of market optimism over the development of potential vaccines and the reopening of the economy. In the US, the lockdown implemented to curb COVID-19 spread resulted in an unprecedented increase of jobless claims, pushing the unemployment rate to 14.7% – a level not seen since the Great Depression. Despite the historic developments in the labour force, the US equity benchmarks registered their strongest monthly performance since 1987. The S&P 500 gained 12.68%, while tech-heavy NASDAQ is on track to recover back to end-2019 level with its 15.45% return during the month. In the same vein, European equities ended the month with a strong rebound as most countries in the region began to ease their lockdown measures on top of the approved half-trillion economic stimulus by the European Union. The DAX and the CAC 40 were up 9.32% and 5.02%, respectively in April. Over in Asia, the equity markets in the region enjoyed strong rally driven by the market risk-on sentiment throughout the month, with the KOSPI and Nikkei 225 up 10.99% and 6.75% respectively during the month.

Approximately 79.8% of the underlying constituents of the Eurekahedge Hedge Fund Index posted positive returns in April, and 10.5% of the fund managers in the database were able to generate double-digit returns over the first four months of 2020.

Figure 1: April 2020 and March 2020 returns across regions

Figure 2 illustrates the 2020 performance of hedge fund managers across regions. All regional mandates were down for the year, driven by the escalation of the COVID-19 outbreak which resulted in massive sell-offs in the global equity market in February and March. North American hedge funds led the pack with 3.79% loss over the first four months of 2020, outperforming their peers focusing on Asia ex-Japan and Europe which slumped 4.22% and 6.90% respectively over the same period.

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1 Based on 48.36% of funds which have reported April 2020 returns as at 14 May 2020