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July 20, 2005
Hedge Funds to benefit from M&A; strategies
Swiss Capital Group believes that the hedge fund returns may get a boost from recent activities in Merger & Arbitrage along with equities. In the first half of the year, downgrading of bond status of Ford Motors and General Motors, Merger & Arbitrage strategy suffered heavy losses. However, Swiss Capital Group is upbeat about Merger & Arbitrage hedge funds. The group is also positive about hedge funds utilizing equity long-short strategies primarily in technology and healthcare sectors. Commenting on macroeconomic data, Joerg Ruetschi who is a business analyst with Swiss Capital Group said that the data makes it difficult for hedge funds to spot and play sustainable trends. This may lead to erratic movements in the market. Swiss Capital Group which primarily focuses on alternative investments and structured products also added that the hedge funds which follow the macroeconomic trends might continue struggling in the second half as well. The macroeconomic trend they were chiefly referring to are global macro strategies and managed futures. Hedgeco.net reports:
“Swiss Capital Group says its outlook for Merger and Arbitrage hedge funds is neutral-to positive. The Group also said it has a more positive outlook for hedge funds utilizing equity long-short strategies, particularly in the technology and healthcare sectors. “
Read More: M&A seen boosting returns for Hedge Funds in the coming months
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