Women and minority-led hedge funds have outperformed their non-diverse peers over the short and long term, according to the Bloomberg Hedge Fund Chartbook.
Funds with minorities represented in management had a median one-year total return of 29.6%, and those with women represented in management returned 21.6%. Fund managers without those attributes had a 12.7% gain in that period.
Over a three-year annualized period, women and minority managers posted a total return of 10.6% and 7.8%, respectively. Non-diverse managers had a 6.4% return.
The Chartbook report is derived from the Bloomberg Hedge Fund database.
Among the other findings:
- Hedge funds have underperformed the broader market in the past five years. The Bloomberg All Hedge Index rose 34.4% in the five years through Sept. 30, while the S&P 500 gained 98.7%.
- The industry’s 2-and-20 fee structure is no longer standard practice. The median fund manager across all funds charges a management fee of about 1.25%, while the performance fee is 15%.
- In the second quarter of this year, most new fund launches were macro funds. Event-driven strategies saw the fewest launches.
— With assistance from Michael Boyle.