BOSTON (Reuters) – D.E. Shaw’s Orienteer platform, the spine of the $50 billion funding agency’s multi-asset class choices, posted excessive double-digit returns this year, the perfect ever in its six year lifetime.
The Orienteer platform’s HV variant gained 41.three% by means of November whereas the primary Orienteer strategy gained 25.eight% throughout the identical time, an individual conversant in the returns stated.
Orienteer, launched in mid-2013 with lower than $100 million in capital, now manages $2.2 billion in belongings in a approach that seeks danger publicity throughout typical belongings courses like shares, commodities, credit score and charges.
Each of the Orienteer methods — HV variant and the primary strategy — handily outperformed danger parity benchmarks. The HFR Risk Parity Vol 15 Institutional Index returned 27.three% whereas the HFR Risk Parity Vol 10 Institutional Index gained 18.eight%, based on knowledge from the analysis group.
A spokesman for D.E. Shaw declined to remark.
Risk parity funds use an allocation strategy to attempt to construct a diversified portfolio through which every asset group — fairness, credit score, charges and inflation — contributes an equal quantity of danger in order that the return just isn’t primarily decided by shares.
The strategy, first pioneered within the 1990s, captured buyers’ consideration after the monetary disaster of 2007-2009. Hedge fund Bridgewater Associates, which launched its risk-parity All Weather Fund in 1996, and AQR Capital Management are huge buyers within the area.
Orienteer has gained in all 4 of its underlying danger classes, fueled by constructive outcomes from a mixture of systematic and discretionary bets.
D.E. Shaw, based in 1988, was lengthy recognized for investing methods pushed by pc fashions, however through the years it has branched out into different methods.
Hedge funds have usually had a extra constructive year in 2019 with the typical fund gaining eight.6% by way of November, knowledge from HFR present.
Reporting by Svea Herbst-Bayliss; Editing by Leslie Adler