Crypto-related hedge funds assets under management soared last year as a result of a recent survey. However, there have been some major performance disparities in 2019.
The total amount of AUM cryptocurrency grants jumped to over $21 billion by the end of 2019, from $1 billion by the end of 2018. In addition , the average amount per fund rose from $21.9 million to $44 million, as per the recent survey conducted by PwC and Elwood Asset Management Service Ltd. The price of BTC surged by 95 percent in 2019.
Crypto-related hedge fund performance 2019
According to the study, long-term funds had the highest intermediate performance of 42% on average. In comparison, both long and short discretionaries had an average and median advance of 33%. Multiple strategy funds increased by a total of 15%.
With a 30% jump in quantitative funds, they had an efficiency of 58 percent. The 28 percent gap between the two numbers means that there have been some huge out-performers. According to PwC ‘s global chief and partner, Henri Arslanian:
“The volatility of crypto markets offers many opportunities for quant traders. The performance of crypto quant funds tends to be more linked with market volatility rather than market performance.”
Nevertheless, the study report came with caution: the findings were compiled by the fund managers themselves and were not authorised by the controller of sovereign funds or any other intermediary.
Criticism of digital currencies
Digital currencies have their own critics, including the billionaire Warren Buffet, Nouriel Roubini and many others. Two years ago, in May, Warren Buffet went on to describe BTC as a “rat poison squared.” However, they went on to intrude more institutionally, holding back the launch of fresh products such as futures and options.
According to the survey, 97% of participants traded Bitcoin, 67% Ethereum, 38% Stellar Lumens, 38% LTC, 31% BCH and 25% EOS. As per the report, it is surprising that LTC appears among the top traded altcoins, given its market capitalization, in comparison to the other cryptocurrencies.
“I expect the crypto hedge fund industry to grow significantly over the coming years as investing in a crypto fund may be the easiest and most familiar entry point for many institutional investors looking at entering this space,” PwC’s Arslanian stated.