AIMA Hedge Fund Confidence Index (HFCI)
The positivity in the market is reflected in the interviews conducted post survey with a number of managers and industry stakeholders. The industry appears to be tiptoeing back to normal amidst vaccination rollouts increasing in scale and lockdown restrictions being lifted. In APAC and certain parts of the US major business districts are seeing an increase in numbers returning to the office. Fund managers with larger workforces appear to be returning to the office at a slower rate than those with smaller teams. We are also seeing pockets in the market where certain teams or personnel that need to collaborate are going back to work in-person or are already back in the office.
AIMA Hedge Fund Confidence Index Q1 2021
The third edition of the HFCI shows that the average confidence level continues to grow among hedge funds globally. Regionally all funds surveyed report higher confidence levels than the previous quarter with the highest levels of confidence remaining among North America based funds.
AIMA Hedge Fund Confidence Index Q2 2021
The fourth edition of the HFCI shows that the average confidence level continues to grow among hedge funds globally, although North America saw a slight dip in its confidence score compared to Q2, leading to it being overtaken as the most confident region by the UK for the first time. This edition of the HFCI also saw a significant uptick in the overall AuM of respondents, which rose from around US$1 trillion in Q2 to roughly US$1.6 trillion this time.
AIMA Hedge Fund Confidence Index Q3 2021
Confidence numbers across the industry reported lower in Q4 amidst a number of headwinds emerging including challenging performance and prevailing regulatory and compliance issues. November performance figures saw hedge funds give back some of the gains made over the past 18 months as financial markets got spooked by renewed fears regarding the spread of the Omicron coronavirus variant and to what extent this would arrest the pandemic recovery. Inflationary concerns exacerbated the problem, with bond markets experiencing a difficult time resulting in some macro funds enduring a challenging end to the month. Regulatory and compliance headwinds have also picked up, with the pace of regulatory change accelerating in the UK and EU as each side seeks to forge a new path post Brexit while regulators in the US have hinted that asset management firms there are likely to see a greater volume of supervisory action over the coming year.
Despite these challenges, the mood across the industry remains upbeat with 90% of all respondents being positive about the economic prospects of their business over the coming 12 months. Notwithstanding the November performance setback, year to date, hedge funds on average are posting double-digit returns net of fees. Allocations to hedge funds continue to be brisk, including into new strategies (across both public and private markets) as investors look to the qualities of hedge funds to best manage any downside risk arising from market volatility and deliver on performance better than any other asset class.
AIMA Hedge Fund Confidence Index Q4 2021