Two-thirds of hedge funds fall short of index returns after fees

first_imgSource: CEM Benchmarking #*#*Show Fullscreen*#*# Hedge funds underperformed a simple equity/debt index over the last 17 years by 1.27% once their hefty fees were taken into account, according to an assessment of major international investors.CEM Benchmarking analysed the realised hedge fund portfolio returns from 382 large global investors in the 17 years up to 2016, and found that only 36% of portfolios examined beat the company’s equity/debt optimised index over the period after taking account of fees.Before fees, the average outperformance over the period was 1.45%, but this was wiped out by costs of 2.72%, CEM said.The figures came from its Hedge Fund Reality Check survey, as well as results of a one-off survey of 27 leading pension funds. The investors in the study typically paid 2.2% in direct hedge fund fees in 2016, and 3.26% for those using fund-of-funds structures. Funds-of-funds underperformed by 2.11% after costs over the 17-year period, CEM said.Alexander Beath, senior research analyst at CEM and lead author of the study, said: “Although some investors have invested in hedge funds because they are supposedly uncorrelated, our research suggests that most hedge funds, at the total portfolio level, behave remarkably like simple equity/debt blends.”Many pension funds could buy a passive alternative at a low cost with very similar risk and return characteristics, he said.Back in 2000, CEM Benchmarking said only around 2% of large institutional investors had money invested in hedge funds but this had grown to 50% by 2016.Of the 36% of hedge funds that did beat CEM’s benchmark after costs, the company said these investors “generally had long histories with hedge funds, portfolios with lower correlation to equity/debt blends, and lower-cost direct hedge funds”.center_img Source: CEM Benchmarkingnlast_img read more

Oshewa Dominates NNPC/Chevron Tennis Masters

first_imgAfter failed attempts, last weekend was a moment of reckoning for young Michael Oshewa as he finally broke the jinx of being the only top three junior player in the country that has never won the annual NNPC/Chevron Junior Masters.The young star was the hero of the day as he dominated his opponent, Stephen Augustine to win the 17th edition of the tournament. Oshewa, still basking in the euphoria of Team Nigeria successful display at the last International Tennis Federation (ITF) West and Central Africa Junior Championship in Cotonou and Lome, reenacted the feat as he showed class, determination and grit before over whelming his opponent to submission in two straight sets of 6-4, 7-6.The largely school children that turned out at the game erupted in jubilation moments after Osewa picked the decisive second set on the Lord Rumens Centre Court of Lagos Lawn Tennis Club, Onikan Lagos as the young lad inked his name as the 17th winner of the longest-running junior tennis championship in the country. Both players excited the crowd with several rallies that often go the way of the winner.Augustine, who had lost in the last seven meetings against Oshewa, was unable to shake off the fear of facing his nemesis. He started playing catch-up from the fifth game when Oshewa broke with a right hand winner down the line,.That was the break the latter was waiting for, putting his nose in front and never looking back as he closed out the first set 6-4 in a little 37 minutes.If the first set was easy, the next was the reverse, as Augustine dug deep, in his attempt to take the match to a decider, rattling Oshewa as early as the third game, only to be paid back in his own coin but managed to push his foe to tie-break, which he inadvertently lost in rather dramatic fashion.After pushing Oshewa to the brink of defeat in the second set, Augustine somehow and rather clumsily allowed the initiative to slip him, serving wide twice, before making two unforced errors to gift the set and match to Oshewa, who pumped his fist in the air to celebrate his victory.He was cheered by the school pupils, who were truly entertained by the serves, volleys and winners of the two finalists, who made the day a truly memorable one for tennis faithful, who went home entertained and satisfied.Share this:FacebookRedditTwitterPrintPinterestEmailWhatsAppSkypeLinkedInTumblrPocketTelegramlast_img read more