Hedge Fund Style Outlook

Looking hedge fund industry as a whole, I'm interested to see what people think about the outlook for different styles such as L/S equity, credit, event-driven, distressed, etc.

Obviously, few funds fit neatly under one of these umbrellas but I have the intuition that there is significant headwinds for the classic L/S equity funds like the Tiger cubs who are often considered ideal career destinations and yet have performed poorly recently. Seems like there is simply too much money chasing alpha for a pretty popular / standard strategy. Same thing for classic distressed style. The days where few investors were willing to get their hands dirty with fallen angels / a complicated chapter 11 have seemingly faded.

My intuition is that the best funds (or styles of funds) in terms of outlook are those that are most opportunistic (think Third Point, Baupost, Abrams, Elliot, Castleknight, Diameter, Sixth Street Fundamental). Obviously, each of these funds have different mandates / strategies but each seem to be have performed well recently and are smart in terms of looking at different asset classes / geographies with an emphasis on inefficiencies, asymmetric return profiles, etc. as opposed to relying on the ability to pick which stock will go up or down.

 

Quidem molestias assumenda neque inventore similique. Rerum consequuntur ut quia deserunt ut.

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