Hedge fund liquidating


By John Kemp LONDON (Reuters) - Hedge funds have resumed liquidating their bullish long positions in crude oil and refined fuels amid more signs that the earlier rally in prices has fizzled out.

Hedge funds and other money managers cut their combined net long position in the six most important futures and options contracts linked to petroleum prices by 50 million barrels in the week to March 6. heating oil (-5 million) and European gasoil (-13 million).

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Funds may decide to close their door for many reasons which might range from poor performance to large amounts of investor withdrawals.In 2016, the asset-weighted hedge-fund index returned 2.86% while the fund-weighted index returned 5.47%.The S&P 500, with dividends, gained 11.93% and the Barclays bond index returned 3.19%.Read: The hedge-fund model is under assault For the full year, a total of 1,057 funds were closed, topping the 1,023 liquidations seen in 2009 but short of the record 1,471 closures seen in 2008.Noting earlier figures, HFR said capital rose to .02 trillion at the end of 2016, topping the previous record of .97 trillion seen at the end of the third quarter.Criticism of high fees comes as the 2-and-20 formulation (a management fee of 2% of assets an “incentive” fee of 20% of profit) has faced significant pressure, they say.

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