The Morning Brief: Renaissance Funds Fared Well Last Month

Renaissance Technologies had an especially strong September. As a result, two of the East Setauket, New York firm’s three funds that are still available to investors are among the better-performing hedge funds through the third quarter. The top fund is Renaissance Institutional Diversified Alpha fund (RIDA), which trades global futures and forwards and U.S. and non-U.S. equities listed on U.S. exchanges. Launched on March 1, 2012, it surged 9.11 percent last month and is now up 11.03 percent for the year.

The Renaissance Institutional Equities Fund (RIEF), which employs a net-long investment strategy and uses computer programs to trade U.S. and non-U.S. equity securities listed on U.S. exchanges, jumped 7.55 percent last month and 10.58 percent for the year through September. It was created to generate gross annual returns of 400 to 600 basis points, or 4 to 6 percentage points, above the Standard & Poor’s 500 stock index over rolling three- to five-year periods, using average leverage of about 2.5 to 1. RIEF gained 14.5 percent in 2014, besting the 13.7 percent return for the S&P 500.

The Renaissance Institutional Futures Fund (RIFF) climbed 0.31 percent last month, trimming its loss to 1.71 percent for the year. It employs an absolute return investment strategy that uses leverage to trade global futures and forwards, aiming for low correlation to other asset classes.


Fortress Investment Group plans to shutter its floundering macro hedge fund “in the coming days,” according to Bloomberg, citing a person with knowledge of the firm. The fund, headed by Michael Novogratz, extended its loss in September by 4.67 percent and is now down 17.49 percent for the year, according to a regulatory filing.



Boston-based Baupost Group initiated a stake of more than 25.8 million shares in Orexigen Therapeutics, or 17.17 percent of the total outstanding. The biopharmaceutical company has a $316 million market capitalization. At the end of the second quarter, New York-based multi-strategy firm Millennium Management was the company’s sixth-largest shareholder.


The Lyxor Hedge Fund Index rose 1.1 percent during the first week of October, as global equity markets continued to rebound from their summer slump. Event-driven funds outperformed, rising 2.2 percent, while CTAs underperformed, losing 1.9 percent. This is not surprising during a rising stock market. “During the coming weeks, we expect that the recovery of event-driven managers is likely to continue,” Lyxor states in its latest weekly newsletter. “We also believe that the recent outperformance of global macro funds versus CTAs is likely to persist.”