By Maiya Keidan and Rod Nickel
Toronto (Reuters)-Some global hedge fund investors are optimistic about the rapid recovery from the economic challenges associated with the coronavirus pandemic entering 2021.
Hedge funds that use leverage and adopt a more aggressive and risky strategy than other investors believe that many previously undesirable sectors, from energy to retail, will recover in 2021. I will.
Hedge funds accounted for about $ 3 trillion in assets, showed resilience in 2020, and many outperformed the market, according to investors.
Jason Donville, President and Chief Executive Officer of Toronto-based hedge fund Donville Kent Asset Management, said: “I think 2021 will be a really positive year for the market. He predicts that the surge in demand for travel and leisure will create a period of” super-growth. “
“I think it will take some time for the vaccine to go on sale. Then, around March, April, and May, the vaccine confluence will reach a certain critical mass and the infection rate will drop.”
Throughout 2020, it increased informally by 16.26%. This is a spectacular recovery from the bear market that began when the pandemic expanded rapidly earlier this year.
“What I can say about 2021 is that it will be a year of recovery,” said Robert, Chief Investment Officer of UK-based Capital Generation Partners, which invests in hedge funds globally. Sears said. “That’s the consensus view.”
The risers in 2020 include the S & P 500 Information Technology Sector. The sector grew by more than 42% as it benefited from the rapid acceleration of online trends. Meanwhile, S & P 500 Hotel Restaurant and Leisure aimed to rise 1.4%, but leisure inventories recovered in the previous quarter as vaccine deployments raised expectations for a recovery.
“The macro situation should remain very volatile, so the macro should be a good year,” Sears said of funds investing in response to macroeconomic trends.
He added that currencies and commodities-focused funds should work.
Jack McIntyre, portfolio manager at Brandywine Global, a $ 62 billion US company running a macro hedge fund strategy, said in the new year, “less uncertainty and more certainty.”
Philippe Ferreira, a fund of Paris-based hedge fund Lyxor Asset Management, said finance is a sector that is plagued by the coronavirus and may be supported by a recovery, which is usually in the early stages of recovery. He added that it will perform better.
“As we are heading for recovery, managers are mitigating short financial biases,” said Ferreira, a company investing in hedge funds globally.
The S & P Financial Index rebounded in the fourth quarter, but fell by about 4.3% in 2020.
“On the macro side, managers say they are diversifying bonds with inflation, especially with gold, because interest rates are so low,” Ferreira said.
According to market participants, energy in North America is another hit sector that is popular with hedge funds. Canada’s energy sector index fell 37.8% across 2020, while the US equivalent index fell 37.3%.
“All of the energy … as long as fuel demand rises, it’s a COVID recovery strategy and people will start returning to the office,” said one Canadian hedge fund manager.
“We have added names such as AltaGas (TSX :), Pembina, and Canadian Natural (NYSE :) Resources, and have been a purchaser since the US presidential election.”
AltaGas’ share price plummeted 60% in March and fell 5.1% in the year to December 31st. Shares in Pembina and Canada fell 61.3% and 27.3% in 2020, respectively.
Jay Tatam, portfolio manager for Valent Asset Management, a New York-based metal-focused company, said: He added that oil is the only source of energy for growth.
Hedge funds bet on recovery in 2021 Reuters
https://www.investing.com/news/stock-market-news/hedge-funds-bet-on-recovery-in-2021-2378933 Hedge funds bet on recovery in 2021 Reuters