The hedge fund industry is characterized by its dynamic nature, constantly evolving in response to market trends and investor preferences. In recent times, there has been a notable diversification of investment strategies, with hedge funds increasingly exploring alternative assets and innovative approaches beyond traditional markets.
Goldman Sachs Sees Surge in Hedge Fund Interest in Cryptocurrency Markets
The approval of ten new spot Bitcoin ETFs in the United States in January has spurred increased activity and attention from hedge funds in cryptocurrency markets, according to a Bloomberg report in which Max Minton, head of Asia-Pacific digital assets at Goldman Sachs, is also quoted.
In an interview Minton asserts that the majority of Goldman clients with large accounts are actively involved in a cryptocurrency space, or planning to get in it soon.
The investment bank, Goldman Sachs, established its crypto trading desk in 2021, and at present, it engages in cash-settled trading of Bitcoin and Ethereum options as well as CME-listed futures tied to both cryptocurrencies, but it does not conduct direct trading of the underlying assets.
This swing in the demand is primarily driven by clients that already exist, mainly traditional hedge funds that harness these crypto derivatives, among other uses, for directional bets, yield enhancement or hedging purposes.
Minton noted, “It was a quieter year last year, but we’ve seen a pickup in interest from clients in onboarding, pipeline, and volume since the start of the year.”
While the majority of interest remains focused on Bitcoin-related products, Minton anticipates a rise in interest for Ether-related products if Ether ETFs also receive approval in the US.
This information is based on the article analyzed and reported by ThePlatform’s analysts team: Hedge funds up activity in crypto options, says Goldman – Hedgeweek
Silver Emerging as Hedge Fund Favorite Amidst Gold Price Peak: Kitco Report
As reported by Kitco, it seems that gold price are peaking at their highest points and therefore hedge fund managers are moving their focus to silver as they believe it may be a lucrative investment in precious metals in the future.
What we get from the report is that the ratio of gold/silver which is still on a high side at more than 88 points, is increasing now and gold is beginning to lose momentum.
Thanks to the recently released Commitments of Traders data from the Commodity Futures Trading Commission, the disaggregated report unveils that the speculative gross long positions by the money manager has boosted its operations in silver futures by 7,963 contracts across the week from 12 to 19 March, and now are at 53,484. On the other hand, short positions have declined by 3,365 contacts and at 16,362 now.
An indicative sign of increased optimism in the silver market is a rise in a bullish positioning that has occurred over the last three weeks without a break, leading to 37,122 net long contracts that have accumulated since April 2022.
Despite the noteworthy increase in bullish speculation, the silver market remains actually quite below where it was around the time of the prices jumping upwards towards the threshold of $30 an ounce in early 2020.
This information is based on the article analyzed and reported by ThePlatform’s analysts team: Silver to shine as record gold run slows – Hedgeweek
Recovery and Resurgence: Andurand’s High-Risk Hedge Fund Bounces Back with 20% Gain in 2024
According to a Bloomberg report, Pierre Andurand’s high-risk hedge fund, the Andurand Commodities Discretionary Enhanced hedge fund, has rebounded after suffering a significant 55% loss in 2023, now showing a 20% gain since the beginning of this year. Sources familiar with the matter, who requested anonymity, have confirmed the fund’s performance up to March 22, 2024. Notably, Andurand manages this fund without predefined risk limits.
The fund suffered significant losses during 2023 for the most part due to joint tickets on the increase in oil prices that have suffered due to the drop of 10% of Brent Crude prices. This prompted Andurand Capital Management to manage the risk associated with the fund which it oversees and is estimated to have collected $1 billion by the end of last year, as reported by Bloomberg in January.
This year, the fund has seen gains attributed to various factors, including supply disruptions due to escalating conflicts in the Middle East, damage to critical energy infrastructure in Russia by Ukraine, and increasing global demand, resulting in a roughly 14% rise in oil prices.
This information is based on the article analyzed and reported by ThePlatform’s analysts team: Andurand’s riskiest hedge fund up 20% after record loss in 2023 – Hedgeweek
ExodusPoint Capital Management Faces Second Year of Client Withdrawals Amidst Challenges
In 2023, the clients withdrew almost $1 billion from Michael Gelband’s hedge fund on ExodusPoint Capital Management which is the second year in a row that the clients are withdrawing. Another market exit of this size was witnessed by the firm in 2022, amounting to hundreds of millions of dollars, as art investment funds closed to new investments three years prior. They have succeeded in collecting $1 billion in the previous year, which could serve as the company’s problem in dealing with the redemptions. Through ExodusPoint’s success, one cannot help but notice the pitfalls and glaring setbacks of managing a whopping $12 billion portfolio.
ExodusPoint opened in 2018 as an eight-billion-dollar company, being the biggest hedge fund launching ever. On the one hand, it has had less stellar showings versus other peer firms including Ken Griffin’s Citadel and Izzy Englander’s Millennium Management. First, the fund had its best performance ever in 2020 showing a 13% return, but in 2021 it has had a 2.3% return up to March 22.
The attractiveness of hedge funds that underperform have lengthy lockups and high fees have decreased relative to Treasuries, which give very high returns. Another focus that has hit multistrategy funds such as Exodus Point is more clients are showing interest in exiting the strategy as data from Goldman Sachs Group Inc shows that 2024 is the year for this move.
ExodusPoint has faced challenges in developing its equities group since its inception, with Gelband’s fixed-income unit contributing most to the fund’s performance. Last year, the firm ended its partnerships with external firms Pythagorean Trading and Ritter Alpha, which traded equities on its behalf. Furthermore, ExodusPoint closed its Paris unit, which had opened in 2019 with approximately 20 employees. In late 2023, ExodusPoint halted Dubai-based portfolio manager Bhavit Sawjani’s trading activities after he incurred losses exceeding $70 million. Although Sawjani remains with the firm, he no longer manages capital, and his team has been disbanded. To strengthen its equities unit, ExodusPoint recently made several hires, including portfolio managers Yash Agarwal and Todd Finegold, both of whom previously worked at Citadel, and James Tjarksen from Point72. Additionally, last year, the firm appointed Adam Galeon, a seasoned healthcare portfolio manager, to lead its long-short equities operation.
This information is based on the article analyzed and reported by ThePlatform’s analysts team: ExodusPoint Hedge Fund Clients Yanked $1 Billion in 2023 – Bloomberg
London-Based Gemcorp Capital Expands to Abu Dhabi: Pioneering Private Credit in Emerging Markets
Gemcorp Capital, a London-based trading hedge fund, has planned to inaugurate in Abu Dhabi by the end of this year. This company, catering to emerging markets, plans to utilize a workforce of 15 employees for their new corporate hub within a year’s time. Furthermore,the office will try to expand its range not only in the UAE but in other parts of Africa and the developing countries in general, with a distinct focus on private credit – a novel asset class, which has emerged globally and is becoming fashionable in the region.
Its current assets under management stands at about $1.2 billion while the company also has a representative office in Dubai. One year ago this firm chose to hire Simon Penney, a former British trade commissioner for the Middle East, to supervise its activities in the capital of this country.
Gemcorp’s venture abroad follows the direction of most financial firms choosing to start their businesses in Abu Dhabi where an impressive number of operational entities were increased in the recent years. Asfa Masaati Dauhan, the free economic zone of Abu Dhabi, has experienced unprecedented growth and is already attracting such companies as Brevan Howard Asset Management which have relocated from Switzerland to Abu Dhabi.
Furthermore, Gemcorp, having successfully developed and utilized the platform in Abu Dhabi, is intending to launch another $1 billion fund for foreign investments into the Saudi market. The fund will be managed by the fund managers who would be engaged separately and it will be open to both global as well as domestic investors.
This information is based on the article analyzed and reported by ThePlatform’s analysts team: Hedge Fund Gemcorp Plots Abu Dhabi Office in Private Credit Push – Bloomberg
Success Stories and Strategies: Astignes Macro Hedge Fund Outperforms and Expands Amidst Industry Challenges
The Astignes macro hedge fund has achieved an annualized return of 6.5% since its inception in February 2007, surpassing the 5.5% return of a comparable Eurekahedge index. While hedge fund firms in Asia typically manage smaller assets compared to their US and UK counterparts, those that have allowed rapid growth often suffer performance declines and investor withdrawals. For instance, Graticule Asset Management Asia Pte, overseeing $4.5 billion by March 2016, experienced significant losses in its flagship fund in March 2023 due to market volatility triggered by the Silicon Valley Bank collapse. However, large regional asset managers like PAG have succeeded by diversifying into different asset classes or investment strategies. Astignes recently recruited Aimad Taleb, formerly of JWM Partners LLC and Deutsche Bank AG, to lead a new strategy focusing on liquid investments and broader markets. Taleb heads a three-person team and serves as the chief investment officer for the systematic strategy. Meanwhile, Lye Shiang Hue took over as CIO of the discretionary macro strategy at the beginning of 2022, completing a successful leadership succession—a rarity in an industry often marred by fund closures due to founder departures. Astignes’s macro fund posted a 2.6% return in the first two months of 2024, benefiting from investments in China and Japan, while its systematic strategy profited from commodity market rallies.
This information is based on the article analyzed and reported by ThePlatform’s analysts team: $3 Billion Hedge Fund Astignes Seeks Hundreds of Millions for New Strategy – Bloomberg
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