January 23, 2015 / 1:11 PM / 5 years ago

UPDATE 1-Swiss franc helps boost Man Group's computer-driven hedge funds

(Adds details, background)

By Nishant Kumar

LONDON, Jan 23 (Reuters) - Man Group’s hedge funds which use computer programs to drive their investment decisions have made gains of up to 5.7 percent in the first two weeks of January, profiting in part from the surprise jump in the value of the Swiss franc.

Man Group is the world’s biggest listed hedge fund firm with $72.3 billion in assets at the end of September last year.

The gains extend such computer-driven funds’ march over their human rivals from last year and comes at a time when some of the best known macro hedge fund managers suffered deep losses due to a surprise move in the safe-haven currency last week.

Man’s $4.4 billion AHL Diversified fund gained 4.5 percent through Jan. 16 this year, while the $4 billion AHL Evolution fund returned 5.7 percent, according to data seen by Reuters.

The $2.8 billion AHL Alpha fund advanced 2.9 percent, while the AHL Currency fund, which gained 58 percent in 2014, added another 4 percent to its returns.

A Man Group spokeswoman declined to comment.

The jump in the Swiss franc’s value came at a time when more than $3.5 billion was betting on a the franc weakening, the largest such bet in more than 18 months. It led to losses for money managers such as COMAC Capital and Everest Capital.

However, portfolios at the start of the year indicated that the computer-driven funds were anticipating the franc strengthening.

Such funds had a net long exposure of 0.72 percent on the Swiss franc, data showed from Lyxor Asset Management for funds managing $54 billion, indicating a profit when the franc rose.

Conversely the global macro hedge funds that use fundamental analysis to bet on the financial markets, representing $288 billion in assets on the Lyxor platform, had a net short position on the Swiss franc of 2.6 percent.

The computer-driven, “trend-follower” funds returned nearly 10 percent last year, according to data from industry tracker Eurekahedge, nearly three times the average gains made by fundamentals-driven global macro hedge funds. (Editing by Greg Mahlich)

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