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Morning Brief: Hedge Funds Turn in Best Performance Since 2013

Hedge Fund Research reports that funds made money every month of 2017, ending the year with an 8.5 percent gain.

  • By Michelle Celarier

Hedge funds ended 2017 with gains every month, marking the first perfect calendar year since 2003, according to data tracker Hedge Fund Research. It’s also the best annual performance since 2013, HFR reported.

The HFRI Fund Weighted Composite Index gained 8.5 percent in 2017, after a 0.9 percent gain in December.

Event-Driven and equity hedge funds led the gains, according to HFR, attributing the winnings to “an improving M&A environment in technology, media, healthcare, retail and manufacturing, as well as expectations for now-enacted comprehensive U.S. tax reform.”

HFR’s equity hedge fund index rose 13.2 percent, while its event-driven index was up 7.3 percent. The winner among event-driven strategies was special situations, whose index gained 11.62 percent.

The Macro Index, gaining only 2.25 percent, was among the laggards, while short-biased funds fell 10.2 percent.

The HFR Blockchain Index, launched in December, earned 2,961 percent in 2017.

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Barry Rosenstein’s Jana Partners and the California State Teachers Retirement System are using their shareholder activism to try to make Apple’s iPhone more socially responsible, the Wall Street Journalreported.

They argue that Apple needs to address what some see as a “growing public-health crisis of youth phone addiction,” according to the Journal.

The two investors, who control about $2 billion of Apple shares, sent a letter to Apple on Saturday urging it to develop tools to deal with the problem.

Jana hopes to a raise a multibillion-dollar fund to focus on social responsibility at corporations, the Journal reported.

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Jeff Smith’s Starboard Value is unimpressed with the 2018 growth targets of Israeli chipmaker Mellanox Technologies Ltd’s 2018, according to a letter made public on Monday by Reuters.

Mellanox is forecasting low to mid-teens revenue growth, but that is “not nearly enough” given the lackluster performance of recent years, Starboard said in a letter to the company, according to Reuters.

Starboard, with a 10.7 percent stake, is the company’s largest shareholder.

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