By Nell Mackenzie
LONDON (Reuters) – Hedge fund efficiency, on common, is healthier 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 Get together 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 essential 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 effectively when the Home and Senate majority have been in a single celebration 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 the most effective below Democrats — averaging a 12.7% return in comparison with 9.6% below the Republicans, over the past 34 years, stated HFR knowledge.
Hedge funds buying and selling M&A offers and the relative worth between completely 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 have been the one technique listed with larger returns throughout Republican presidents, in response to HFR.
The dispersion between hedge fund efficiency, or the distinction between the most effective and worst performing funds differed probably 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 yr of a president’s time period and got here in lowest throughout two time period presidencies within the second, sixth and final yr.
With 2008 and the monetary disaster eliminated, the outcome skewed marginally in direction of Republicans. Hedge funds returned 10.7% with Republicans throughout these years, in comparison with a ten.2% outcome with presidents from the Democratic Get together, HFR stated.
