By Nell Mackenzie
LONDON (Reuters) – Hedge fund efficiency, on common, is best when the U.S. president is a Democrat, knowledge from analysis agency HFR confirmed on Tuesday, as U.S. voters headed to the polls.
Underneath Democratic Social gathering presidents, hedge funds averaged a ten.2% annualized return, whereas below a Republican president hedge funds returned 8.7% on common, confirmed the information from Hedge Fund Analysis’s principal index which tracks the returns of world hedge funds.
This knowledge from HFR’s HFRI Fund Weighted Composite Index tacked hedge funds’ efficiency averaged over presidential phrases from 1990 to 2024.
Hedge funds carried out roughly twice as properly when the Home and Senate majority had been in a single occasion than they did with a cut up legislative physique, the HFR knowledge confirmed.
Efficiency when Democrats had a majority within the U.S. Congress got here in larger than with Republicans, the information additionally confirmed.
By technique, inventory hedge funds fared one of the best below Democrats — averaging a 12.7% return in comparison with 9.6% below the Republicans, over the past 34 years, mentioned HFR knowledge.
Hedge funds buying and selling M&A offers and the relative worth between totally different monetary property additionally had larger returns throughout years when the president was a Democrat, the information confirmed.
Funds speculating on macroeconomics or so-called macro hedge funds had been the one technique listed with larger returns throughout Republican presidents, in keeping with HFR.
The dispersion between hedge fund efficiency, or the distinction between one of the best and worst performing funds differed essentially the most throughout years when the president was a Democrat, it added.
Hedge funds’ annualized efficiency averaged the best in the course of the first 12 months of a president’s time period and got here in lowest throughout two time period presidencies within the second, sixth and final 12 months.
With 2008 and the monetary disaster eliminated, the consequence skewed marginally in direction of Republicans. Hedge funds returned 10.7% with Republicans throughout these years, in comparison with a ten.2% consequence with presidents from the Democratic Social gathering, HFR mentioned.
