AQR, an investment management company, records the best year in several strategies
By Nell Mackenzie
(Reuters) – AQR’s Absolute Return Strategy in 2022, an investment management firm, saw its highest year since 1998. According to a source with knowledge of this matter, Friday was the best since its inception.
The $100 billion-sized firm AQR reaped top performance from many of its strategies. It took advantage of strong trends across futures markets and markets moved by macroeconomic factors.
Global equity markets saw $14 trillion of their value wiped away last year. Nearly 300 interest rate increases and three rallies over 10% added to market volatility.
The Absolute Return Strategy of AQR, a multi-strategy mutual fund, earned 43.5% last fiscal year, net of fees, according to the source. The source stated that it was a result of careful portfolio selection.
Its Equity Market Neutral Global Value, and Global Macro strategies posted record years of 44.7% and 42.0%, respectively, net of fees. The source also said that the Alternative Trend Strategy had an excellent year, posting a 48.9% net fee.
Hedge Fund Research’s (HFR) index tracks the performance and trends of the largest global hedge funds. It posted a decline of 2.78% for the year through November 2022. A larger index that tracks the entire industry experienced a decrease of 3.87% by the end of November 2022.
AQR is an investment company that offers hedge fund strategies, but also long-only and mutual funds.
According to Reuters, the source said that AQR’s trend strategies would continue being successful in times of sustained volatility and macro instability.
Cliff Asness, founder and CEO of AQR, wrote a blog this week titled “The Boom Has Not Burst”, which referred his 2001 article about the high price of stock market valuations.
Asness stated in the blog post, “Like in 2022 there are sure to be terrible reversals but as Wile E.Coyote finds out, gravity cannot be stopped.”
(Reporting by Nell Mackenzie; editing done by Dhara Ranasinghe, David Evans)