18 May 2018 Alternative UCITS Market Overview April 2018
In the current more volatile market environment, Alternative UCITS funds become increasingly popular with investors that seek diversifying return streams. Assets under Management for the total universe advanced again with +5BEUR in April to reach 465BEUR, another record high.
In line with a clear trend that started in January, investors mainly increased their exposure to portfolio diversifiers such as Discretionary Macro (AUM +12%) and Alternative Risk Premia (AUM +3.5%) strategies. Despite a very rough start to 2018, allocations to CTA’s (the ultimate de-correlating strategy) also increased with +1% during April. Where Equity Long/Short funds stayed roughly equal in assets (AUM -0.3%), the more prudent Equity Market Neutral funds are clearly more sought after in the current environment, increasing their AUM with +2.7% on average.
After a difficult start to 2018, many Alternative UCITS funds recovered in performance during April. The LuxHedge Global Alternative UCITS index advanced with +0.22%, bringing 2018 YTD to -0.47%. Most strategies did well, most notably Equity Long/Short Europe (+0.94%) and Discretionary Macro (+1.20%). Dispersion amongst Alternative UCITS funds stays very large: where the worst fund of the month returned -7%, the top performer gained well over +10%.