Hedge funds have been consistent performers thus far in 2019, with the HedgeNews Africa South African Composite gaining 6.59% to the end of October. Yet choppy market conditions have caused a wide dispersion in returns, even amongst funds in the same categories.
The year-to-date median return lags an almost 10% gain from the JSE All Share Index and around 8% from the All Bond Index, but with far less volatility, resulting in a smoother overall return profile.
Global hedge funds have also had a strong year thus far, gaining 5.56% to the end of October, according to the HedgeFund Intelligence Global Composite, yet also trailing global equity indicators.
This month’s first provisional nominations for the 11th annual HedgeNews Africa Awards, to be presented in Cape Town in February, reveal a strong early line-up of managers that have steered through variable markets to deliver convincing gains for the year so far.
Our next round of provisional nominees will be released in our December online edition, based on 11 months of data, with the final nominations issued in January once the full-year data set is available.
Given persistent market volatility, the line-up could well change as managers steer through the remaining weeks of a difficult year.
Nominations are based on net returns, although the ultimate winner in each category is based on risk-adjusted return – the winning fund must have a Sharpe ratio that is within 25% of the top Sharpe in each category.
The first provisional nominees are:
36ONE SNN QI Hedge Fund
Fairtree Assegai Equity Long Short SNN QI Hedge Fund
Market Neutral and Quantitative
Peregrine Capital Pure Hedge H4 QI Hedge Fund
X-Chequer SNN Diplo QI Hedge Fund
Blue Quadrant Capital Growth Prescient RI Fund
Fairtree Wild Fig Multi Strategy SNN QI Hedge Fund
Acumen AcuityOne SNN Retail Hedge Fund
Terebinth SNN FI Macro Retail Hedge Fund
Catalyst Alpha Prescient QI Hedge Fund
Chrysalis Credit Arbitrage Fund
Enko Africa Debt Fund
Gondo Visio Metsi Fund
Fund of Funds
Momentum RCIS Multi Managed ZAR Equity Hedge QI Hedge Fund
Momentum RCIS ZAR Diversified QI FOF
The Awards will be celebrated at a gala dinner at the Vineyard Hotel in Cape Town on February 20, 2020.
Now in their 11th year, the Awards are based on an established quantitative methodology that gauges risk-adjusted returns.
The awards, based on calendar-year performance, will go to funds with the highest return in their categories, provided their Sharpe ratios are within 25% of the top Sharpes among the nominees in each category. Exceptions are made in the case of categories that combine different strategy areas, where other quantitative criteria may need to be applied.
To qualify for a nomination, funds must average a minimum of $10 million, or R80 million, in assets under management in that strategy throughout the calendar year (in fund structures plus associated segregated mandates).
Exceptions are made in the new fund category, which allows for lower AUMs, and considers funds with a track record of 12-23 months (with the award based on calendar-year returns) and the longer-term awards, for which higher minimums apply.
Funds submitting their monthly returns to our database are automatically considered for the Awards. New funds can submit data to firstname.lastname@example.org before the end of November.
Data used in deciding the awards will be independently examined by eComply Consultants to ensure consistency and accuracy.
Awards categories include:
• Long/short equity
• Market neutral and quantitative
• Fixed income
• Specialist strategies
• Pan Africa
• Fund of hedge funds
• Five-year performance
• 10-year performance
• New fund of the year
• Fund of the year