Investment manager Neuberger Berman in their recent report point out that a rising interest rate environment would be ultimately constructive for long/short equity hedge funds.
Neuberger Berman in their report titled: “2014 Hedge Fund-Strategy Outlook” notes discretionary global macro managers are better suited to generate profits in the current policy-driven market environment.
Constructive on long/short equity in 2014
The report notes the recent trends of lower stock correlations and higher valuation dispersion will continue, aided by a higher interest rate environment over the medium term. The investment manager believes this should prove beneficial to the ability of long/short equity funds to generate alpha.
The report also foresees an environment of positive economic growth, higher levels of corporate activity, rising interest rates and increasing differentiation...
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