Article by Masahiro KUMADA
Hedge Funds are sometimes compared to Passive Management. Some even say Hedge Funds can’t beat passive management. However, we believe that there are strong reasons why we still include Hedge Funds in our portfolios.
As you know, they have no correlation with other assets in the portfolio to make the overall management stable. Or the characteristics themselves show stable performance and increase the overall performance efficiency. Therefore, the selected hedge fund must show the characteristics of its movements more than its performance.
Why do we choose Hedge Funds?
Firstly, let’s check at the table below which is the performance information for Satellite Growth Fund.
One of its characteristics is that it has no negative months of performance on an annual basis.
Secondly, please take at the look at the chart below. Dow Jones Industrial Average has not been able to beat the performance of the Satellite Growth Fund over the last 1 year. You can easily compare the result at a glance.
Although it is not a race to perform for only a single year, it would not be sound management to end the fiscal year with a negative result due to the volatility of the NY Dow when managing funds with a one-year fiscal period.
In addition, especially in the case of individual asset management, people tend to focus on the fund with the best performance at the time. It is important to understand the characteristics of the assets and to include the right fund at the proper ratio.
According to a Bloomberg report, this year’s net Hedge Fund inflows are the highest since 2017. Another report says, that the inflows have become so large that some funds have stopped accepting new money.
Every day, more and more hedge funds around the world are using new management techniques. We believe that the emergence of novel and innovative management techniques will contribute to the development of global financial markets.
—————————————–
Masahiko KUMADA
Follow us !!
＜LinkedIN＞ Masahiko KUMADA
＜Twitter> @tunecapital
＜Website＞Tune Capital AG Group
—————————————–