It is thus fitting that the all-time leading hedge fund operator, Renaissance Technologies, sits atop the hedge fund performance table of large and established strategies. Through 11 November 2011 Renaissance Institutional Equities leads the pack with a return of 32.54%. As impressive as this undoubtedly is, what’s even more remarkable is that the return is net of the reported 5% management fee and 36% profit participation which Renaissance charges. The 2011 performance also displays a close approximation to the 35% average annual return rung up by another Renaissance offering, the Medallion Fund, which trades non-stock instruments in the US and internationally.
For Marshall Wace, 2011 marks a welcome return to form. MW Global Opportunities, launched in February 2009 and managed by Fehim Sever, had returned 27.08% to 15th November. This makes it the best performing of the established funds run by European managers in 2011. But it is not the only Marshall Wace fund to feature prominently on this year’s leader board. MW Eureka, run by co-founder Paul Marshall, was up 10.3% by the end of October.
Another big, established player with funds leading the pack this year is BlackRock Alternative Investors. As Matt Botein, BAI’s youthful managing director, continues to build this $115 billion alternative investment colossus, it must be hugely encouraging that BlackRock can still run niche strategies that sharply outperform the hedge fund market. In 2011, the systematic BlackRock 32 Capital Master Fund had returned 21.66% to 11 November, while the BlackRock Fixed Income Global Alpha Fund was up 17.25% for the same period.
Any run-down of the hedge fund industry leaders in 2011 would be incomplete without acknowledging the 10.82% gain to 31st October of the Brevan Howard Master Fund. Run by macro maestro Alan Howard and still managing about $25 billion, the fund largely marked time over 2010 and the first half of 2011. It came alive over the summer, however, as Treasuries surprisingly rallied further amid a heightened bout of market volatility. Although the big managed futures operators are largely off the leader board (and the Tulip Trend Fund has suffered heavy drawdowns, losing 22.26% to 11 November), Discus Feeder run by Capital Fund Management in Paris deserves special mention for a 22.58% gain over the year to 11 November.
Perhaps it is indicative of how 2011 has gone for portfolio managers that John Paulson should emerge the biggest loser. Paulson Advantage Plus cratered by 45.59% to 31 October. For early investors, annualised performance of over 18% since the 31 December 2004 inception will offer some comfort. Looking ahead, it will be fascinating to see what lessons Paulson takes from 2011 and how he seeks to re-emerge as a hedge fund leader.
Bill McIntosh, Editor
bill.mcintosh@thehedgefundjournal.com
