Joe McGuane, CFA
Senior Research Analyst, Alternatives
This week’s chart shows the performance of Goldman’s portfolio of hedge fund favorites, which draws from over 800 fundamental-driven hedge funds’ top 10 long equity holdings. This hedge fund index is constructed with approximately 50 holdings commonly held in the top 10 by fundamental hedge funds.
In the fourth quarter of 2018, top hedge fund holdings gave back all their first half gains and underperformed the S&P 500 for the year. These popular holdings were positively correlated with growth and momentum factors. They were also heavily weighted toward the technology sector which helped them outperform during the first half of 2018.
As the calendar flipped to 2019, hedge fund performance has rebounded strongly, finishing the quarter with the strongest performance since 2006. Sector weights to information technology, communication services, and consumer discretionary drove outperformance from the most widely held hedge fund names. This strong start to 2019 was much needed for hedge funds, as 2018 returns failed to meet investor expectations. Of course, this represents only one quarter of the year and investors will be following hedge fund performance closely for the remainder of 2019 to see if this pattern continues.
The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.
Small businesses are often thought of as the backbone of the U.S. economy. Long before the coronavirus, the Russell 2000…
New jobless claims fell from a peak of 6.9 million for the week ending March 27th to 3.2 million for…
Research alerts keep you updated on our latest research publications. Simply enter your contact information, choose the research alerts you would like to receive and click Subscribe. Alerts will be sent as research is published.
We respect your privacy. We will never share or sell your information.
If you have questions or need further information, please contact us directly and we will respond to your inquiry within 24 hours.Contact Us >