Hedge funds suffer in 2011, says HSBC Private Bank

Hedge funds have endured a torrid year, according to the latest edition of HSBC’ ranking of hedge funds by their returns.

Big names featuring in the bottom 20 of the HSBC Hedge Fund Performance Report include Odey European (-22.7%, equity diversified fund), RAB Global Mining & Resources Fund (-26.35%, an equity diversified/global) and three of John Paulson’s six funds (Advantage and Advantage Plus and Recovery, all multi-strategy/global funds).

Paulson was forced to apologise to his investors in November for his worst performance in 17 years. His Advantage Plus sits at the bottom of the table, with -47.77% (as of Nov. 30, 2011). Paulson did better with his Credit Opportunities (18.2%, distressed security/global) and his two merger arbitrage/global funds, Enhanced (19.86%) and International (9.25%).

A number of top performing funds crashed out last year, to find themselves languishing in the bottom 20, highlighting the extreme volatility of the markets. Two funds that had been in the top three in 2009 and 2010, but are now at the foot of the table are Henderson European ABS Return (-42.80%, equity diversified) and SenVest Partners (-36.98%, equity mid-small cap/USA); Philippe Jabre’s Jabcap Balanced Fund, from being third in 2009, has posted -26.88%.

Steve Heinz’s Lansdowne European Long Only fund was down 2.47%, while UK Equity fund performed lost 19.65%.

Head of the table is Jim Simons’ Renaissance Institutional Equities (equities diversified/USA), which gave investors a return of 34.66%, after a bad run through 2009 and 2010. RIE is followed by Fehim Sever’s Marshall Wace Global Opportunities (26.57%, equity diversified/global) and BlackRock 32 Capital Master Fund (24.41%, systematic/global).

The report is not published and is for private circulation among clients of HSBC Private Banking only. Notable absences from the report include Ray Dalio’s Bridgewater Associates, which reports suggest gained 25%, Oaktree Capital and Eclectica, among others.

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