Many hedge funds are believed to yield considerable returns to investors; there is an assumption that suggests hedge funds seem uncorrelated with market fluctuations and have relatively low volatility. In recent years, emerging market hedge funds have experienced a higher capital inflow in periods when the diversification benefits of investing in emerging markets are higher. However, the strategy‟s share of the hedge fund industry‟s total capital flows has decreased significantly during the same periods: this might imply that investors have reallocated capital to other hedge fund strategies. This paper investigates whether emerging markets hedge funds have been as consistent in performance as the benchmark indices by presenting results of comparative analysis of two sample emerging markets hedge fund indices and two standard emerging markets benchmarks performance. The empirical study ranges from the period of January 2006 to December 2010.

Actively-managed funds have recently come under fire as it has been determined that they consistently underperform passive funds. Benchmarking, and the constraints placed on actively-managed funds, are standard practices within the industry, but research suggests that these constraints negatively affect fund performance. This research paper explores the effectiveness of actively-managed funds in relation to their benchmark indices, in terms of tracking errors and weighting constraints. This is done by qualifying the effect of these constraints on the performance of hypothetically constructed portfolios in relation to the FTSE / JSE Top 40 Index. The results are presented graphically and show that tracking error limits did, as expected, limit the possible upside returns of these funds. It was found however, that the tracking error constraints had a much greater effect on limiting downside risk than they had on limiting upside effects. Weighting limitations did not have a single universal effect on the simulated portfolios’ performance but affect performance in conjunction with tracking error limits. It was concluded that for the hypothetically constructed portfolios for the period studied, constraints did not affect the possible upside return to such a magnitude that the constraints themselves could account for the underperformance of actively managed funds and they had an overall positive effect on performance. / Mini Dissertation (MBA)--University of Pretoria, 2018. / Gordon Institute of Business Science (GIBS) / MBA / Unrestricted

Recently, the selections of ethical funds are increased; at the same time investors with social and moral preferences have increased in the capital market. There are currently debates on whether ethical funds perform better or worse than funds without ethical criteria. This also involves a vivid discussion on whether investors know about the consequences of investing in ethical funds. Therefore, this study involves theories about the rationality and decision theory, in addition to what mainly control the investment decisions. The study also discusses portfolio theory since this is one of the underlying theories behind fund management and its development. The purpose of this study is to explain if ethical limitations in the selection of securities affect risk and return in the fund portfolio. This study has positivistic research approach and a quantitative method. The method involves some calculations and equations used that will be presented. The study indicates that ethical funds actually deliver better risk adjusted returns than its Swedish benchmark index. It also indicates a trend that ethical funds deliver better excess returns than funds without ethical preferences. Furthermore, the study concludes that no statistical difference between the ethical funds and the benchmark in terms of risk in investment can be demonstrated. One limitation of the study is that the survey mainly includes the Swedish market with Swedish company stakeholders. This means that there may be a need for research in a global market where also cultural aspects need to be considered. It has not previously been quite clear how ethical fund performance in the Swedish market, and at a time when demand for ethical choice increases, the goal of this study was to clarify the performance of ethical funds. / På senare tid har urvalet av etiska fonder ökat, samtidigt som investerare med sociala och moraliska preferenser har blivit allt vanligare på kapitalmarknaden. Det finns idag diskussioner om huruvida etiska fonder presterar bättre eller sämre än fonder utan de etiska kriterierna. Detta innefattar också en livlig diskussion om huruvida investerare är medvetna om konsekvenserna av att investera i etiska fonder. Därför berör studien teorierna kring den rationella- och beslutsteorin, för vilka huvudsakligen styr investeringsbesluten. Studien behandlar också portföljvalsteori då detta är en av de bakomliggande teorierna för fondförvaltning och dess uppkomst. Syftet med denna studie är förklara om de etiska begränsningar i urvalet av värdepapper påverkar risk och avkastning i fondportföljen. I studien kommer en positivistisk forskningssats användas samt en kvantitativ metod. Metoden innefattar en del beräkningar och ekvationer som används och som presenteras. Studien pekar på att de etiska fonderna faktiskt levererar en bättre  riskjusterad  excessavkastning än sitt jämförelseindex på den svenska marknaden. Den visar också tendenser att de etiska fonderna levererar en bättre excessavkastning än de fonderna utan etiska preferenser. Vidare kommer studien fram till att det inte kan påvisas någon statistisk skillnad mellan de etiska fonderna och jämförelseindexet vad det gäller risken i investeringar. En begränsning med studien är att undersökningen huvudsakligen innefattar den svenska marknaden med svenska företagsaktörer. Detta gör att det kan finns behov av forskning på en global marknad där även de kulturella aspekterna behöver bejakas. Eftersom det tidigare har varit ganska oklart vad det gäller etiska fondernas prestanda på den svenska marknaden, och i en tid då efterfrågan på etiska urvalet ökar, är målet med denna studie att bringa klarhet om etiska fonders prestation.