Hedge funds have beaten the market for the first time in 10 years

Hedge funds reported a 0.4 percent gain from the beginning of the year to April, beating the broad US index S&P 500, which lost 0.4 percent over the same period.
Increased volatility, along with the rise in energy prices, as well as well-traded bond bets, have been the basis for better industry performance, comment market observers.
This is the first time in nearly a decade, when hedge funds beat the broad US index. For the first four months, the S&P 500 index recorded a decline of 0.38%.
The sectors with the best performance since the beginning of the year were from the health and technology. They have brought a 4.54% yield, while fixed income betting strategies have yielded a net return on hedge funds of 3.12% from the beginning of the year to April.
In April, the most performing sectors were the energy sector and the base materials sector, with a growth of 4.46%.
The rise in oil and other commodity raw materials contributed to the good performance of the energy sector, which registered a growth of 1.5, as well as of the basic materials sector by 2.3%.
Cryptocurrencies also contributed to the strong performance of hedge funds. The tracking blockchain technology index declined by 19.3% since the beginning of the year, but only in April added 47.1% to its value.

Hedge funds use the highest leverage since 2015

US hedge funds take up more money to buy shares after the signals of increased dependence between the direction of the US economy and their chosen companies.
Leverage among managers speculating for growth or a decline in stock prices rose this month, near its highest levels of bullish market that began in 2009, according to data from Goldman Sachs Group Inc.
Increased use of borrowed money means that professional managers tend to take more risk after eight years of growth in markets. And while leverage brings greater losses if stock prices are declining, the downward movement this year was minimal.
The broad US state index S&P 500 has its longest series without a 3% correction or more in its history. Apparently hedge funds assume that this trend of good performance will continue.

How much did the ETF-fund fees have fallen since the financial crisis?

The index funds are the big news of the last decade. They seriously "eat" the share of hedge funds in the asset management industry and the consultancy sector.
One of the main reasons for the wide popularity of these investment schemes is undoubtedly the low fees they collect, unlike the traditional scheme 2-20 of the hedge funds - 2% of the assets and 20% of the profits.
According to a study by the Investment Company Institute, the spending rate of US index funds fell by nearly a third from 2009 to 2016. Or it is down by 32% on average to 23 basis points (or 0.23% of the value of assets), down from 34 basis points in 2009.
The data covers the long-term bullish market that emerged after the financial crisis of 2008.
Meanwhile, the index funds industry is now managing assets worth more than $2.3 trillion, according to FactSet data. The assets of the industry are constantly reaching new and new highs every month in recent years.
The largest index managers, including Vanguard and BlackRock, through their funds, have already announced a reduction in their fees several times. The three largest companies in the sector manage over 70% of the total assets of the industry.
Many of the most popular index funds have a fee of less than 0.1% of their assets. For example, BlackRock's S&P 500 fund has fee at just 0.04%, which means $4 for every $10,000 invested.
Funds investing in fixed income instruments have an average charge of 0.2%, where the fall is far less against the average 0.26% in 2013.

Bank of America Merrill Lynch: Speculators buy dollars

Interest in the dollar continues for several weeks in a row, as the main driver of this process remains demand from hedge funds. The positioning of market participants compared to last year remained neutral, but the difference between the behavior of hedge funds and "real money" investors is obvious, analysts say.
Their models predict further growth of the US currency, but the main issue remains the participation in this process of "real money", which generate the bulk of capital flows.
The results of a research of analysts of the bank suggest that "real money" adhere to the moderately optimistic outlook for the dollar, however, do not rush to increase their long positions.