Fear is everywhere in volatility market even as the VIX retreats (Link)
The recent decline in the Wall Street fear gauge to pre-virus levels belies the “tension beneath the calm” within the volatility landscape, according to the traders at Assenagon GmbH with 27 billion euros ($32 billion) under management.
The extreme demand for portfolio hedges suggests that all is not well for the U.S. stock bull run, which is already on shaky ground between rising Treasury yields and extended lockdowns.
But despite the VIX finally closing under the psychological 20 level over the past week, a deluge of technical indicators show investors are still bidding up downside protection.
Hedge fund firms plow into private investments (Link)
At least eight investment firms best known for their hedge funds have made more private investments in the first quarter than any other three-month period.
Investor interest in private companies appears to be at an all-time high
Institutional investors have been influenced by Reddit - but they still don't trust it (Link)
One in five investors surveyed by Brunswick said they made a trade, changed a recommendation, or altered a position because of the WallStreetBets subreddit.
At the same time, however, the survey recorded a sharp decline in how much investors trusted Reddit as a source of information, with 54 percent of respondents giving the social media platform a score of 1 or zero out of 10.
The most popular newsletter provider was the controversial finance blog Zero Hedge, which in recent years has earned a mixed reputation for publishing financial analysis and conspiracy theories. Monringstar's newsletters were the second-most cited, followed by the Motley Fool Stock Advisor.
Crypto hedge funds gained 35% in February as bitcoin soared (Link)
Cryptocurrency hedge funds posted their best gain since 2019 February, rising 35%.
Data provider Eurekahedge said the growing industry has around $3.5 billion under management.
Crypto hedge funds climbed almost 200% in 2020 as the bitcoin price soared.
Most hedge funds run by massive asset managers like BlackRock and Janus are trailing the average performance this year (Link)
Of BlackRock's five hedge funds listed in HSBC's Hedge Weekly report, just one has been above average through the first two and a half months of 2021.
The world's largest asset manager has its long-running flagship fund Obsidian, managing $1.6 billion, and the $1.5 billion Fixed Income Global Alpha fund both returning under 2% through the first two months of the year.
Both the roughly $600 million Emerging Companies hedge fund and $262 million BlackRock UK Equity have lost money - 1% and 0.14%, respectively - through March 12.
Long-running trend-following hedge fund Drury Capital scores double-digit returns amid 'erratic' market movements (Link)
The Diversified Trend Following Program advanced 13 per cent in the first two months of 2021, and gained almost 38 per cent in the 12-month period to the end of February.
Commodities account for around half the portfolio, and its returns were fueled by gains across aluminium (up 5 per cent), copper (up 5.5 per cent) and cotton (up 2.7 per cent).
Meanwhile, the Drury Capital Multi-Strategy Futures Program, a new CTA strategy launched in 2020, has generated a 22 per cent return during its first year of trading to February 2021, outperforming its annual return target of 14% with 10% volatility.
The Multi-Strategy Futures Program, which combines global equities and fixed income markets investing with an uncorrelated trend-following approach, scored a 3.8% gain last month, outflanking the S&P 500’s 2.6 per cent rise, amid surging commodity prices.