Month in Review – February 2022

Stockholm (HedgeNordic) – This February, Nordic hedge funds experienced their second-worst performing month since 2008, as Danish fixed-income hedge funds ended a volatile February with significant losses. The Nordic Hedge Index slid 2.4 percent in February (87 percent reported), bringing the year-to-date decline to 4.2 percent.

All five strategy categories in the Nordic Hedge Index experienced losses for a second consecutive month, with fixed-income strategies suffering the worst performance as a group in February with an average decline of 4.3 percent. Fixed-income funds are down 5.4 percent over the first two months of 2022. Equity hedge funds booked an average loss of 1.7 percent last month to bring the 2022 decline to 4.4 percent. Multi-strategy funds fell by 1.6 percent in February and Nordic CTAs ended the month of February down 1.3 percent. Funds of hedge funds, meanwhile, edged down an estimated 0.6 percent last month to bring the year-to-date decline to 1.1 percent.

At a country level, the Danish hedge fund industry, dominated by fixed-income strategies, lost the most in the second month of 2022 with an average decline of 5.1 percent. Danish hedge funds are now down 6.9 percent over the first two months of the year. Finnish hedge funds booked an average loss of 2.8 percent in February as their 2022 decline reaches six percent. Swedish hedge funds, which account for the highest portion of the Nordic hedge fund industry, were down 1.0 percent last month and Norwegian funds edged down 0.9 percent.

The performance dispersion between last month’s best- and worst-performing constituents of the Nordic Hedge Index widened even further month-over-month. In February, the top 20 percent of Nordic hedge funds advanced 3.4 percent on average and the bottom 20 percent lost 8.9 percent on average, representing a top-to-bottom dispersion of 12.3 percent versus 9.9 percent in January. In January, the top 20 percent were up 2.5 percent on average and the bottom 20 percent were down 7.4 percent. About one in every four members of the Nordic Hedge Index with reported February figures posted gains last month.

Top Performers in February

Energy transition-focused fund Proxy Renewable Long/Short Energy Fund was last month’s best-performing member of the Nordic Hedge Index with an advance of 14.3 percent as energy transition-related sectors had a favourable development compared to broader markets in February. Last month’s advance brought the fund’s performance for the year back into positive territory at 8.7 percent.

Max Mitteregger’s long/short equity fund Gladiator Fond, which will be merged with Adrigo Small & Midcap L/S under Adrigo’s management later this year, followed suit with a monthly advance of 12.7 percent. The fund is now up 16.1 percent over the first two months of 2022. Norwegian discretionary macro fund NOR Global Makro gained 10.2 percent last month and currently ranks as this year’s best-performing member of the Nordic Hedge Index with an advance of 17.4 percent.

Atlant Green Tech Metals, meanwhile, advanced 5.7 percent in February to bring its 2022 performance back into positive territory at 2.9 percent. After reaching its best month on record in January this year, long/short equity fund Elementa gained an additional 5.4 percent in February to bring the year-to-date advance to about 16 percent.

The Month in Review for February 2022 can be downloaded below: