- AuM in Alternative UCITS reached EUR 224.3 billion growing by 41% in total for 2014
- AuM in Events Driven strategy increased 59% in H2 2014
- Managed Futures was best performing alternative UCITS strategy in 2014 with the AH Managed Futures Index gaining 14.3%
- Event Driven was worst performing in 2014, declining -2.7%
- 19 new alternative UCITS strategies launched in H2 2014
The strength of alternative UCITS sector continued to grow with assets under management (“AuM”) increasing 41% to EUR 224.3 billion in 2014, illustrating the robust demand seen for alternative UCITS funds, according to the latest Alceda UCITS Review.
2014 proved a difficult year for active managers, with the AH Global UCITS Index (“the Index”), which encompasses a total of 498 funds, returning only 1.3% in 2014, compared to the almost 6% gains seen in 2013. However, the Alternative UCITS market has continued to encourage new entrants with the launch of 53 funds in 2014 (19 in H2 2014). There were also over 20 fund closures in the year as a result of challenging performance or failing to raise significant assets, in particular within specialist asset classes or strategies where investor demand remains somewhat muted, such as regionally focused Equity Long Short.
Returns of the individual index sub-sectors were also muted with Credit, Macro, and Equity Long Short strategies all delivering returns between -1% and +1%, while delivering high levels of inflows. Credit, Macro and Equity Long Short strategies saw AuM increase by 49%, 25% and 15% respectively in H2 2014. This highlights a strong degree of performance dispersion in the underlying managers, highlighting the importance of good manager selection.
Despite their popularity among investors, Event Driven strategies performed less well with several events in Q3 and Q4, including large deal breaks in September and October, causing the Index to lose ground, leading to a -2.7% decline for the year. Despite this, Event Driven strategies saw a significant increase in AuM, up 59% in H2 2014, as investors looked to capture the elevated levels of corporate activity, particularly in the US.
Managed Futures was the best performing strategy, gaining 14.3% for the year, with AuM increasing 29% in the second half of 2014. Many of the underlying funds successfully captured moves in equities, bonds, and in the second half commodities, to deliver strong double digit returns for investors. Michael Sanders, CEO and Chairman of the Board, Alceda Fund Management S.A. said: “These results show the ongoing attractiveness and demand for alternative UCITS strategies globally with investors increasing allocations and managers, in particular in the US, choosing UCITS to target European investors. In addition, the recent implementation of the AIFM Directive has resulted in a greater focus on UCITS with managers looking to build sustainable distribution strategies for their products. “Overall, 2014 saw a healthy level of new alternative UCITS launches with over 50 new funds across strategies coming to market since 2013, with investors demonstrating clear demand for global and developed market strategies. As we enter 2015, we look forward to the pipeline of new fund launches which remains robust and we expect to see a further year of growth for the Alternative UCITS sector.”
Aquila Capital develops alternative investment solutions for institutional investors worldwide. Founded in 2001 and owner-managed, the investment company considers itself a fiduciary for its clients and applies a holistic approach to managing customised real assets and financial assets.
Aquila Group’s client base consists predominantly of institutional investors in Europe and Asia. Over 200 professionals located in ten offices globally implement efficient investment strategies via fund structures and individual mandates. The Aquila Group comprises Aquila Capital Investmentgesellschaft mbH, which is licensed by the Federal Financial Supervisory Authority (BaFin) to act as an alternative investment fund manager in Germany, and Alceda Fund Management S.A., which is licensed as an alternative investment fund manager and UCITS management company in Luxembourg by the Commission de Surveillance du Secteur Financier (CSSF).
For further information, images or appointments please contact:
T. 0049 40. 55 56 53-175
Alistair Kellie / Madeleine Palmstierna
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