According to researchers in HFR, hedging funds in the Bitcoin market brought a better annual return than their traditional peers. A rally in April 2020 raised the profit of the crypto hedge fund YTD to 13.4%. Meanwhile, Embark Group’s Peter Toogood warned that many fund managers are not rising above US stocks.
Some of the world's leading hedge funds lose the race to make profits to smaller competitors with high exposure in the Bitcoin market.
Hedge fund research group HFR found Bitcoin-focused investment trusts have gained 13.4% this year, which is better than the average 6.7 percent YTD loss in the non-crypto hedge fund industry. The crypto industry flourished in March 2020 despite an average capital loss of 26.62.
For example, Pantera Capital lost 33.6 percent in March through the Digital Assets Fund. However, its recovery in April brought the YTD profit to 32.5 percent. Bitcoin's Wall Street Exposure
One of the biggest reasons for the impressive performance of hedge funds was Bitcoin falling to the third half.
The May 11 event saw that the daily supply rate of the cryptocurrency dropped from $ 1,800 BTC to 900 BTC against the 21 million BTC supply limit. Lower supply against a potentially rising demand led analysts to forecast Bitcoin at higher rates, which allowed it to reach its lowest level in March – from $ 3,800 to $ 10,000. until. Bitcoin halfway date
The split took place at a time when the U.S. Federal Reserve earned trillions of dollars in subsidies to protect their suffering economies from the coronavirus crisis. Many believe that investors use some of their new cash liquidity to increase their bets in the crypto market as a protection against potential fiat-induced inflation.
The inflation versus inflation narrative supported Bitcoin's bull case as the next best safe haven asset. In addition, a billionaire hedge fund veteran Paul Tudor Jones helped him achieve 1-2 percent exposure in the Bitcoin futures market.
[Embed] https://www.youtube.com/watch?v=k9VpVf3g9Y0 [/ embed]
At the same time, the flagship Medallion fund of Renaissance Technologies confirmed that it was looking for Bitcoin for further investment. Stock Market Notice
Crypto hedge funds have recovered as well as a wider market retreat led by the Fed and the US government for a $ 6 trillion-dollar incentive. All leading Wall Street indices increased along with the bitcoin market and improved the second-quarter outlook for the US stock market.
However, Peter Toogood from Embark Group doubted whether US stocks could earn more in 2020. Said to CNBC Despite the fact that many fund managers recovered from the lowest levels in March, they decreased on stocks and gave various reasons to explain their negative feelings.
First, the financial veteran said there was a big difference between a company's earnings and stock price, and some giants, including Apple and Pepsi, withdrew earning guidance in the midst of the coronavirus crisis. Second, the fear that economies will again lead to the second wave of infections also doubles as the stock market.
Speaking to CNBC, Toogood said, "You should ask yourself why it is right to do this when the price / earnings ratio of the US has reached the highest ever."
A negative stock market view can also send investors looking for a haven in bitcoin and bitcoin-enabled fence funds. ...