Falling US bond yields and a weakening dollar are helping drive a recovery in emerging market-focused hedge funds, after some managers including $12bn-in-assets Pharo Management struggled following a tough start to the year.
Emerging market funds gained 1.9 per cent last month, according to data group Eurekahedge, ahead of a 1.1 per cent gain among hedge funds more broadly. That leaves them up 5.4 per cent this year, still behind average hedge fund gains of nearly 8 per cent.
Emerging market managers have been benefiting from a recent decline in US Treasury yields, which soared earlier this year as the easing of coronavirus lockdown restrictions raised investor expectations of a strong US economic recovery and rising inflation.
