Hedge funds allow additions too withdrawals by their investors and are always open-ended and. The hedge fund’s net asset value is directly related to the value of an investor’s holding.
As of 15th of February, the number of Crypto hedge funds more than doubled in the four months. A research firm witnessed a record high of 226 global hedge funds up from 110 global hedge funds as of Oct. 18. The hedge funds tracked by leading hedge fund database provider Eureka hedge show a return of 1,477.85 percent in 2017 on average.
Eureka hedge is an independent hedge fund data provider and according to them Cryptocurrency focused funds lost an average of 4.6 percent in January. “Some invest in just Bitcoin, taking both long and short positions, some buy a basket of Cryptocurrencies and other exploit the arbitrage between different exchanges prices.”, the research firm noted.
Diana Gibson said, “gains in 2017 were largely generated from being long”. Diana Gibson is a managing director at investment consultant Cambridge Associates.
Autonomous Next partner Lex Sokolin commented: “While the softer prices of crypto assets do create a more difficult environment for investors, I do not think it will pause the influx of funds and other financial institutions building products in the space…It would take the extreme case of the entire space contracting by 80 percent and high regulation before the flow of funds turns around”.
All of Eureka hedge’s nine index constitute lost money in January, as they also did during another dip in the price of Bitcoin in September. But other hedge funds investing in Crypto currencies have managed to sidestep Bitcoin downturns by using different strategies.