July may have been a good month for the S&P 500, which is up over 3.5%, generating more than half of the S&P’s entire YTD 2016 return (6.4%) in just one month, but it was another painful month for the active investing “smart money” – of the roughly 40 (rotating) marquee names in our hedge fund tracking universe, only one is beating the broader market this month. This is a problem because as the recent surge in redemptions has shown, LPs no longer care about “beating the benchmark”, and instead are mostly focused on out (or rather under) performing the S&P 500.
The list below, sourced from HSBC, shows just how difficult it has been for most hedge funds to generate respectable performance in the month of July.
For the full year, things are slightly better, with about a dozen names outperforming the S&P500 YTD, and posting respectable double digit returns. Curiously, we find that the worst performing hedge fund of 2014, the Russian Prosperity Fund, is one of the best performers of 2016.
Finally, here is the breakdown of the Top 20 best and worst hedge funds for 2016: at the top we find the relatively unknown, smallish $115 million Dorset Energy Fund, which was also the worst performing of 2015. The worst performer according to HSBC in 2016: Odey, who as we noted earlier this week, has had a very tumultuous 2016 so far.
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