Lyxor - the Weekly Brief: Unstable Markets and Hedge Fund Outperformance

During a period in which most asset classes sold off ferociously and fixed income provided no downside protection, the Lyxor Hedge Fund Index was down only 0.8%. This highlights the resilience of this asset class to wide market movements. Going forward, the risk of policy error is increasing as the Fed begins to implement its exit strategy. As a result, wide market movements may occur more frequently than investors may think and alternative investments will appear to be increasingly attractive amongst the limited options available to protect portfolios.