While hedge funds on average are having another lackluster quarter, there may be one group of them that’s still shining.
The S&P 500 rose 12 percent in the first three months of 2012, while hedge funds only returned 5 percent, according to Hedge Fund Research.
For “event-driven” funds — including, but not limited activist investors that demand strategy and/or leadership change — those returns were even lower for the quarter.
To play the modern activist game, though, longer-term investments are required — meaning a more wide-reaching metric than one quarter must be used to measure their success, so industry group 13-D monitor measures performance from the time situations become “active” — or, a large stake is disclosed publicly.
By that metric, the clear winner of the group is Bill Ackman’s Pershing Square Capital Management. Though Ackman’s annualized returns are buoyed by one blockbuster bet — minting billions from bankrupt real estate at General Growth Properties — it’s still up 148 percent since the firm’s inception.
Dan Loeb’s Third Point is not far behind. Loeb is currently embroiled in a highly publicized proxy fight at Yahoo!, but his past investments have lifted his firm to annualized returns of 98 percent.Page 1 of 2 | Next Page