The average hedge fund rose 2.30 percent in February and is now up 1.86 percent for the year, better than the S&P 500 which rose just 0.95 percent, according to industry tracker eVestment. Of course, hedge funds that don’t specialize in stocks don’t measure themselves against the S&P 500, so this is a somewhat meaningless milestone.
However, the average equity fund is up nearly 2 percent through February, or double the widely-followed stock market benchmark. The best performing strategy so far this year is what eVestment calls broad multi-market funds, up 2.83 percent. Among equity funds, the activists are leading the way, up nearly 4 percent.
“Distressed funds posted their best returns in more than two years, and the broad event-driven category has been rewarding to investors in 2014,” eVestment states in its monthly report. “Event-driven strategies received the second highest level of new allocations to begin the year, behind directional equity.”
— York Capital’s Jamie Dinan believes the overall stock market will be “flat to up” this year but with “many winners.” In other words, he thinks it will be more of a stock picker’s market than last year, which he calls “a beta move.”
In an interview on CNBC, the head of the New York hedge fund firm said he was up 20 percent last year, much better than his long-term annualized return of 14 percent. He said his favorite place to invest right now is the U.S., noting that a majority of his money is in North America. However, he also said he is increasingly moving into Europe — both European credit and European equities. He says European equities are less expensive than their North American counterparts and merger deals are picking up. He also says that existential threats are no longer a fear.
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Shares of Green Mountain Coffee Roasters dropped more than 3 percent, to close at $107.12, its lowest price in exactly a month. The stock is now down 13 percent from its all-time high last month, when investors giddily bid up the stock following the announcement that Coca-Cola agreed to buy a 10 percent stake for $1.25 billion and sign a distribution agreement for Green Mountain’s new soft drink machine.
— Steven Cohen’s family office, SAC Capital Advisors, disclosed it owns 5.4 percent of Gogo Inc., which supplies provides in-flight Internet and entertainment systems. The stock rose more than 1 percent in after-hours trading after the filing.
— The Polygon European Equity Opportunity Fund rose 2.69 percent in February, bringing its year to date gain to 7.11 percent for its A1 Offshore Share class. Last year the $400 million fund, managed by London-based investment firm Polygon, was up 21.5 percent.
