MAN ON THE MONTH |
Date: Thursday, January 20, 2011
Author: Press Release
OPTIMISM FOR 2011 BOOSTED APPETITE FOR RISKIER ASSETS IN DECEMBER
January 18, 2011 – Optimism over the outlook for 2011 led global equities higher
in December amid a fall in volatility and reduced trading volumes due to the
winter holidays. Markets benefited from a surge in risk appetite as a number of
economic data releases proved surprisingly resilient. As a result, the MSCI
World Index (price return) rallied 5.6% in December as investors shrugged off
worries over European sovereign debt and fears of further monetary tightening in
China.
The increase in risk appetite weighed on the US dollar over the month as
investors resumed their search for higher-yielding assets. A number of
commodities also posted double-digit gains as the increased demand for ‘risk’,
supply/demand issues and a weakened US dollar boosted prices.
Michelle McCloskey, Head of Research for Man’s Multi Manager business,
commented:
“December’s market conditions benefitted a variety of hedge fund styles with
managed futures managers ending the month up over 7%, the style’s strongest
monthly return of the year. Global Macro also proved strongly positive as ‘risk
on’ trades such as long equities and commodities profited from improved market
sentiment.”
“Further positive performance was accrued by the Equity Hedged style as a
net-long bias benefited from the strong underlying rally in global equity
markets. Elsewhere, Relative Value and Event Driven managers also gained as
credit indices pushed higher.”
Additional findings from Man’s Multi-Manager’s monthly analysis for December
included:
-
In the Equity Hedged style, European and US focused managers led returns,
particularly those concentrated in the trading oriented mid-cap space.
Asia-Pacific and Emerging Market managers ended with modest gains, with those
who were net-long driving returns. On a regional basis, Korea and Taiwan
exposure proved profitable while positions in Hong Kong and India proved
challenging;
-
The Relative Value style was boosted by strong credit markets in December, with
Credit Arbitrage proving the strongest sub-style over the month. For Relative
Value, credit arbitrageurs drove gains while for Event Driven, Multi-strategy
and Distressed managers led returns. Additional small gains were added by the
Convertible Bond Arbitrage sub-style on the back of a solid rally in underlying
convertible markets; and
-
The Event Driven style secured its fourth consecutive monthly gain in December
as rallying equity and credit markets provided a tailwind to performance.
Distressed managers ended the year in positive territory due to increased demand
for risk assets.
Michelle McCloskey added: “In light of the continued uncertainty over European
sovereign debt, we are excited about Credit Long/Short opportunities going into
Q1 2011. Our decision to overweight allocation to Credit Long/Short managers
remains intact as the prospect of continued volatile credit spreads present
favourable opportunities on both the up and downside. We continue to favour
nimble, fast moving managers given the continued market uncertainty and possible
roadblocks to recovery.”
Enquiries
Annie Smith
Associate Vice President, Fleishman Hillard Canada Inc. Tel: 1 416 645-8198
annie.smith@fleishman.ca
Olivia Tomlin
Senior Communications Officer
Tel: 011 44 20 7144 3266
olivia.tomlin@mangroupplc.com
About Man
Man is a world-leading alternative investment management business. It has
expertise in a wide range of liquid investment styles including managed futures,
equity, credit, emerging markets, global macro and multi-manager, combined with
powerful product structuring, distribution and client service capabilities. As
of October 31, 2010 Man managed approximately USD 67 billon.
The original business was founded in 1783. Today, Man Group plc is listed on the
London Stock Exchange and is a member of the FTSE 100 Index with a market
capitalization of approximately USD 5.9 billion (as of September 30, 2010).
Man Group is a member of the Dow Jones Sustainability World Index and the
FTSE4Good Index. Man also supports many awards, charities and initiatives around
the world, including sponsorship of the Man Booker literary prizes. Further
information can be found at www.mangroupplc.com.