Funds under management in long/short strategies soared from $6.1 billion to $8.7 billion between March 2017 and March 2018, according to Zenith Investment Partners.
According to the research house’s latest Australian Shares – Long/Short Sector Report, Zenith-rated long/short funds outperformed the ASX300 by 6 per cent in the 12 months up to 30 April 2018.
“The most significant period of growth was experienced over the most recent 12 months, with FUM increasing from approximately $6.1 billion to $8.7 billion, representing growth of 43 per cent.”
According to the report, the demand for long/short funds has been driven by the extended equities markets bull run.
“We believe this has led investors to become increasingly concerned about market valuations and a potential market downturn,” the report said.
Investors were turning towards long/short funds for protection of capital in the event of such a downturn.
Zenith investment analyst Jacob Smart added that long/short strategies could play a “beneficial role” in an investor’s portfolio.
“It is also important to recognise that short selling is a specialised skill set that we assess carefully when rating funds.
“The ability to short sell effectively is a key determinant of success in the overall strategy.”
BetaShares has established what it calls the first UK-focused ETF on the ASX, tracking Britain’s sharemarket benchmark, the FTSE 100. ...
The regulatory landscape has fundamentally changed since the Hayne royal commission and entities must engage with regulators in new ways in ...
Perpetual Investment has recorded net outflows of $1.1 billion for the fourth quarter of 2019, while its funds under management fell by $300...