Absolute Returns

Nervousness rose last week as investors continued to prepare for a December Fed hike - increasingly likely - and ahead of the US elections. US rates, the dollar and breakevens progressed, while equities dropped slightly.

According to George Szemere, Head of Global Strategic Relations & Liquid Alternatives, Columbia Threadneedle, there is a growing understanding that extracting returns from a traditional asset-allocation mix is going to be challenging…

As the third quarter came to an end, it is time to take some perspective. The summer lull fuelled risk assets after a turbulent first half (MSCI World +4.5% in Q3) and hedge funds benefitted from it. Strategies with higher betas outperformed, such as L/S Equity and Event-Driven...

For investors seeking meaningful diversification of their portfolios, alternative beta strategies (sometimes called liquid risk premia) have low or no market beta and, if executed correctly, have low correlations to the major asset classes.

The Fed gave its verdict last week and decided to stay put on the back of inflation remaining below its target. Financial markets found the message to be reassuring. They recovered from recent losses related to fears that it may hike as early as this month.