Hedge Fund Monthly Update – May 2014 (UBS)

May 2014

KEYWORDS: long/short equity, MSCI, Relative Value, CTA, commodity trading advisor, interest rate, Macro, fixed income, European Union, trading volume

Authors:

UBS

Organizations:
  • UBS

Summary:

This month’s highlights include:

- Equity Long Short –1.5% in April vs. +1.0% for MSCI World (0.0% YTD vs. +2.3%).
- Value and Quality Factors significantly outperform Momentum in April and YTD.
- Many crowded shorts help offset losses from crowded longs (again), particularly in Info Tech and Cons Disc; Biotech crowded shorts less helpful.
- UBS equity clients add to defensive longs; notable decrease in IT shorts.
- Fall in US interest rates beneficial to CTAs, but not to macro funds; long fixed income in Europe pays off.
- Long USD theme remains popular, but not profitable in April, or YTD.
- Global M&A volume $429B in April, largest monthly volume since financial crisis; follows Q1, the highest quarterly volume since then.

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