Hedge funds protect capital in tough March

Ongoing uncertainties around COVID-19 and the impact on global growth drove investor sentiment through March. Hedge funds were not spared, although they did perform significantly better as a group than various market indices.

The HedgeNews Africa South African Single-Manager Composite declined a median 4.61% in March to sit 6.4% lower for the first quarter, while the broader HedgeNews Africa Single-Manager Composite, which includes Africa-focused and global mandates, fell a median 8.51%, leaving it 10.63% lower year to date.

By comparison, the FTSE/JSE All Share Index fell 12.13% in March (down 21.38% for the quarter) while the South African All Bond Index gave up 9.75% for the month to sit 8.74% lower for the quarter. The MSCI World Index dropped 13.47% (-21.44% for Q1) and the MSCI Emerging Markets Index declined 15.61% (-23.87% for Q1).

Market-neutral was the best-performing strategy for the month, dipping a median 0.19% to sit 0.95% lower for the quarter.

Fixed income funds had a challenging month, coming in with a wide range of returns to record a median decline of 2.07% in March (-0.28% return for Q1).

Long/short equity funds had the toughest time – generating a median -9.08% for the month to sit 13.25% lower for the quarter, while multi-strategy funds fell a median 8.51% to sit 11.65% in the red for the first three months. Copyright. HedgeNews Africa – April 2020

Median Mean 
South African MediansMar-20YTDMar-20YTD
Long/Short Equity-9.08%-13.25%-9.06%-13.15%
Market Neutral & Quantitative Strategies-0.19%-0.95%-2.56%-3.30%
Single Manager Multi-Strategy-8.51%-11.65%-9.43%-13.21%
Fixed Income-2.07%-0.28%-4.12%-2.08%
Event Driven (credit)0.63%2.22%0.63%2.22%
African Medians
Pan-Africa / AME-21.67%-25.78%-18.54%-21.81%
SA Single-Manager Composite-4.61%-6.40%-7.13%-9.55%
HedgeNews Africa Single-Manager Composite-8.51%-10.63%–9.02%-11.46%