Stockholm (HedgeNordic) – Nordic hedge funds lost 0.9 percent on average in May (98 percent reported), the industry’s fourth negative month in five. Despite the Nordic Hedge Index losing 4.4 percent in the first five months of 2022, the Nordic hedge fund industry is outperforming broad markets year-to-date. About one in every three members of the Nordic hedge fund industry is in positive territory so far in 2022.
Four of the five strategy categories within the Nordic Hedge Index ended May in the red, with equity hedge funds as a group edging up 0.3 percent as they dominanted last month’s table of top performers. Equity-focused funds lost 4.2 percent on average in the first five months of 2022. After two consecutive months of strong returns, Nordic CTAs edged down 0.5 percent in May to trim the group’s year-to-date advance to 5.3 percent. Fixed-income hedge funds, meanwhile, are suffering their worst year since 2008, with the group down 7.3 percent in 2022 after incurring an average loss of 2.2 percent in May. Multi-strategy funds were down 1.5 percent in May to extend their 2022 decline to 5.0 percent, while the performance of funds of hedge funds entered negative territory for 2022 at 0.3 percent after the group incurred an average decline of 1.1 percent in May.
At a country level, the Danish hedge fund industry dominated by fixed-income strategies fell by 2.0 percent in May to end the first five months of 2022 down 9.1 percent. Finnish hedge funds were down 1.0 percent on average in May to further extend their 2022 decline to 6.0 percent. Swedish hedge funds, which account for the largest portion of the Nordic hedge fund industry, were down 0.5 percent last month, ending the first five months of the year down 2.5 percent. Norwegian hedge funds, meanwhile, edged down 0.1 percent in May to trim their 2022 advance to 0.9 percent.
The performance dispersion between last month’s best- and worst-performing members of the Nordic Hedge Index decreased month-over-month as losses incurred by worst performers were smaller in May compared to April. In May, the top 20 percent of Nordic hedge funds advanced 3.3 percent on average and the bottom 20 percent lost 4.8 percent, representing a top-to-bottom dispersion of 8.1 percent versus 9.7 percent in April. In April, the top 20 percent were up 3.5 percent and the bottom 20 percent were down 6.1 percent. About one in every four members of the Nordic Hedge Index with reported May figures posted gains last month.
Top Performers in May
Proxy Renewable Long/Short Energy was last month’s best performing member of the Nordic Hedge Index with an advance of 13.8 percent, as renewable energy and clean tech sectors recovered strongly in the second half of May after weak performance in the first half of the month. The energy transition-focused equity fund managed by Stockholm-based Proxy P Management gained 18.4 percent in the first five months of 2022, ranking among this year’s top ten best performing hedge funds in the Nordics.
Adrigo Small & Midcap L/S achieved its best month on record in May in the first month of Gladiator Fond’s merger into Staffan Östlin’s fund. Adrigo Small & Midcap L/S booked a monthly gain of 13.6 percent in May to trim the year-to-date decline to 5.1 percent. Cleaves Shipping Fund, a shipping-only long/short equity fund managed by Joakim Hannisdahl, gained an estimated 12.5 percent in May to extend its 2022 advance to over 44 percent. The shipping fund is currently this year’s best performing member of the Nordic Hedge Index.
Another energy-focused long/short equity fund, OAM Absolute Return, followed suit with a monthly advance of 8.0 percent in May, which brought the fund’s year-to-date performance further into positive territory at about 15 percent. Systematic value-focused fund HCP Quant, meanwhile, gained 5.1 percent in May to bring its year-to-date performance in positive territory at 1.9 percent.
The Month in Review for May 2022 can be downloaded below: