Previously, fees paid by BH Global on outperforming funds would not be offset by those which had underperformed.
Yesterday, Portfolio Adviser published the news of proposals that would result in lower fees. The new management fee is BHMS is 2% with the additional 0.5% management fee stripped out and the performance fee is 20%, subject to a high watermark.
Analysts at Numis said Brevan Howard will remain focused on the key themes from 2013 – US rates opportunities increasing, further stimulus in Japan and the potential for more aggressive monetary action in Europe.
New rates team
Reflecting these views, the manager has set up a 15-strong rates team in the US against expectations that volatility and trading ranges for the greenback and rates will expand materially, providing opportunities to take advantage of two-way price movement, the yield curve and option volatility.
Beyond the US, the manager had expected policy action to continue to fuel equity markets returns and yen weakening.
However, this has not happened so far in 2014 and has acted as a drag on returns. Nevertheless, the manager is maintaining its positioning and expects further QE at some point in H2.
In Europe, fundamental fiscal imbalances have not been resolved, and it is likely that the fiscal stance will become more restrictive which may lead growth to deteriorate. If deflationary pressures persist, the ECB may have to take more aggressive monetary action.
For a closer look at trends emerging from the hedge fund sector, click here.
