Indices Taxonomy
Investment Regions
Asia
Asia offers hedge fund opportunities across a mix of developed and emerging markets. Key countries include China, Japan, South Korea, India, and Vietnam. The region’s growth potential is significant, though geopolitical tensions and market volatility require careful risk management.
Europe
Europe presents hedge funds with diverse opportunities spanning major economies such as Germany, France, the UK, and Italy, alongside emerging markets in Eastern Europe like Poland and Hungary.
North America
The North America investment region includes the US and Canada. It is the biggest investment region for hedge funds, characterized by a strong, stable economy and a diverse array of mature markets and sectors. With a focus on technology and healthcare, North America-focused hedge funds typically employ growth equity and long/short strategies to capitalize on market opportunities.
Emerging Markets
Emerging Markets provide hedge funds with significant growth potential, balanced by higher risks. Major markets include Brazil, Russia, India, China, and South Africa (BRICS), along with countries like Turkey and Indonesia. Hedge funds can engage in long/short equity, macro, and event-driven strategies to capitalize on these markets’ economic expansion while managing political risk, currency volatility, and less developed financial systems.
Global
The Global investment region spans multiple markets, allowing hedge funds to invest in a broad range of developed and emerging economies. Countries like the U.S., Germany, Japan, China, and Brazil are key players. Hedge funds employ macro, relative value, and diversified global strategies, capitalizing on sector and geographical trends while hedging risks associated with individual market fluctuations.
Middle East & Africa
The Middle East & Africa region provides hedge funds with access to natural resources and growth markets. Key countries include Saudi Arabia, the UAE, Qatar, Nigeria, and South Africa. Hedge funds may focus on commodities, infrastructure, and consumer sectors, using event-driven and macroeconomic strategies. Navigating geopolitical tensions and oil price volatility is crucial, often requiring tactical asset allocation and diversified risk management.
Central & South America
Central & South America offer hedge funds investment opportunities in countries such as Brazil, Mexico, Chile, Argentina, and Colombia. Hedge fund strategies can include long/short equity and macro approaches, targeting sectors like commodities, agriculture, and emerging technologies. Investors should remain aware of political instability, currency risks, and economic volatility in these markets.
Australasia
Australasia, comprising Australia and New Zealand, offers hedge funds stable economies with strong regulatory frameworks. Hedge funds can focus on sectors such as finance, real estate, and natural resources. Long/short equity, macroeconomic strategies, and sector-specific approaches are common, taking advantage of the region’s low market correlation and stable growth, while managing global market fluctuations and commodity price shifts.
Primary Strategy Descriptions
Relative Value
The With Intelligence Relative Value Index is an equally weighted index designed to provide a broad measure of the performance of relative value hedge funds which typically seek to exploit price or valuation differences of related financial instruments or assets. These include fixed income arbitrage, relative value credit, convertible arbitrage, volatility arbitrage, statistical arbitrage and alternative risk premia strategies. The index does not contain duplicate funds.
CTA
The With Intelligence CTA Index is an equally weighted index designed to provide a broad measure of the performance of CTA (commodity trading advisor) and managed futures funds.
CTAs typically focus on investing in listed bond, equity, commodity futures and currency markets, globally. Most employ systematic trading programs that largely rely upon historical price data. The index does not contain duplicate funds.
Digital Assets
The With Intelligence Digital Assets Index is an equally weighted index designed to provide a broad measure of the performance digital assets hedge funds that invest in cryptocurrencies or crypto derivatives, or in blockchain and crypto-related companies. The index excludes crypto ETFs and does not contain duplicate funds.
Event Driven
The With Intelligence Event Driven Index is an equally weighted index designed to provide a broad measure of the performance of event-driven and activist hedge funds. Event-driven strategies typically seek to profit by taking positions in mispriced debt or equity, based upon, or in anticipation, of an event or catalyst. Or by taking significant investments in perceived undervalued companies seek to influence corporate management to take initiatives to drive value. The index does not contain duplicate funds.
Fixed Income/Credit
The With Intelligence Fixed Income/Credit Index is an equally weighted index designed to provide a broad measure of the performance of fixed income and credit hedge funds, characterised by a focus on debt instruments. These include long/short, distressed, structured and securitised (MBS/ABS) credit hedge funds as well as multi-strategy credit funds. The index does not contain duplicate funds.
Equity
The With Intelligence Equity Index is an equally weighted index designed to provide a broad measure of the performance of hedge funds that invest primarily in company shares (public equity) and equity derivatives. They can hold both long and short positions and employ fundamental and/or quant approaches. The index includes long/short equity, short-bias equity, long-bias equity, and equity market-neutral strategies. The index does not contain duplicate funds.
Multi-Strategy
The With Intelligence Multi-Strategy Index is an equally weighted index designed to provide a broad measure of the performance of hedge funds that pursue multiple primary hedge fund strategies within the same fund vehicle. The index includes 'multi-manager' funds that employ teams or pods pursuing different strategies, but not funds of hedge fund (FoHF) vehicles. The index does not contain duplicate funds.
Macro
The With Intelligence Macro Index is an equally weighted index designed to provide a broad measure of the performance of macro hedge funds. Macro funds typically take directional or relative value positions in currencies, bonds, equities and commodities, based on views of economic, interest rates, inflation, government policy or other geopolitical factors. These approaches may be systematic or discretionary. The index does not contain duplicate funds.
Secondary Strategy and Index Structures – Descriptions
Fund of Funds
Relative Value Fund of Funds Index
The With Intelligence Relative Value Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ relative value strategies. This equally weighted index captures the performance of funds seeking to exploit price or valuation differences among related financial instruments or assets, including fixed income arbitrage, relative value credit, convertible arbitrage, volatility arbitrage, statistical arbitrage, and alternative risk premia strategies. Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
CTA Fund of Funds Index
The With Intelligence CTA Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ CTA strategies. The equally weighted index designed to provide a broad measure of the performance of CTA (commodity trading advisor) and managed futures funds.
CTAs typically focus on investing in listed bond, equity, commodity futures and currency markets, globally. Most employ systematic trading programs that largely rely upon historical price data. Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
With Intelligence Macro Fund of Funds Index
The With Intelligence Macro Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ Macro strategies.
The equally weighted index designed to provide a broad measure of the performance of macro hedge funds. Macro funds typically take directional or relative value positions in currencies, bonds, equities and commodities, based on views of economic, interest rates, inflation, government policy or other geopolitical factors. These approaches may be systematic or discretionary.
Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
With Intelligence Fixed Income/Credit Fund of Funds Index
The With Intelligence Fixed Income/Credit Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ Fixed Income/Credit strategies.
The equally weighted index designed to provide a broad measure of the performance of fixed income and credit hedge funds, characterised by a focus on debt instruments. These include long/short, distressed, structured and securitised (MBS/ABS) credit hedge funds as well as multi-strategy credit funds.
Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
With Intelligence Event Driven Fund of Funds Index
The With Intelligence Event Driven Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ Event Driven strategies.
The equally weighted index designed to provide a broad measure of the performance of event-driven and activist hedge funds. Event-driven strategies typically seek to profit by taking positions in mispriced debt or equity, based upon, or in anticipation, of an event or catalyst. Or by taking significant investments in perceived undervalued companies seek to influence corporate management to take initiatives to drive value.
Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
With Intelligence Multi-Strategy Fund of Funds Index
The With Intelligence Multi-Strategy Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ Multi-Strategy strategies.
The equally weighted index designed to provide a broad measure of the performance of hedge funds that pursue multiple primary hedge fund strategies within the same fund vehicle. The index includes 'multi-manager' funds that employ teams or pods pursuing different strategies.
Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
With Intelligence Equity Fund of Funds Index
The With Intelligence Equity Fund of Funds Index is a benchmark designed to monitor the performance of a diversified portfolio of mutual funds and hedge funds that employ Equity strategies.
The equally weighted index designed to provide a broad measure of the performance of hedge funds that invest primarily in company shares (public equity) and equity derivatives. They can hold both long and short positions and employ fundamental and/or quant approaches. The index includes long/short equity, short-bias equity, long-bias equity, and equity market-neutral strategies.
Importantly, the index aggregates capital to invest in these funds rather than directly in securities, and it is structured to ensure that no duplicate funds are included.
With Intelligence Europe Fund of Funds Index
The Europe Fund of Funds Index functions as a performance benchmark for a portfolio comprised of various mutual or hedge funds. Instead of investing directly in securities like stocks or bonds, a Fund of Funds (FoF) amasses capital to invest in a range of other funds. The index focused on Europe, where hedge funds encounter a variety of investment opportunities across both established economies such as Germany, France, the UK, and Italy, as well as emerging markets in Eastern Europe, including Poland and Hungary.
With Intelligence Asia Fund of Funds Index
The Asia Fund of Funds Index functions as a performance benchmark for a portfolio comprised of various mutual or hedge funds. Instead of investing directly in securities like stocks or bonds, a Fund of Funds (FoF) amasses capital to invest in a range of other funds.
The index focuses on Asia where hedge fund opportunities across a mix of developed and emerging markets. Key countries include China, Japan, South Korea, India, and Vietnam. The region’s growth potential is significant, though geopolitical tensions and market volatility require careful risk management.
With Intelligence Global Fund of Funds Index
The With Intelligence Global Fund of Funds Index functions as a performance benchmark for a portfolio comprised of various mutual or hedge funds. Instead of investing directly in securities like stocks or bonds, a Fund of Funds (FoF) amasses capital to invest in a range of other funds.
The index focuses on Global which spans multiple markets, allowing hedge funds to invest in a broad range of developed and emerging economies. Countries like the U.S., Germany, Japan, China, and Brazil are key players. Hedge funds employ macro, relative value, and diversified global strategies, capitalizing on sector and geographical trends while hedging risks associated with individual market fluctuations.
With Intelligence ILS Advisers Index
The With Intelligence ILS Advisers Index is ILS Advisers and With Intelligence’s collaborative equally weighted index. The index is designed to provide a broad measure of the performance of underlying hedge fund managers who explicitly allocate to insurance linked investments and have at least 70% of their portfolio invested in non-life risk. The index does not contain duplicate funds and is denominated in local currencies.
The With Intelligence ILS Advisers Index is tracked by ILS Adviser’s ‘ILS Diversified Ltd’, a fund of hedge funds solely invested in insurance-linked securities (ILS).
With Intelligence UCITS Hedge Funds Index
The With Intelligence UCITS Hedge Fund Index is an equally weighted index. The index is designed to provide a broad measure of the performance of underlying hedge fund managers whose funds are UCITS compliant. The index does not contain duplicate funds and is denominated in local currencies.
With Intelligence Short Volatility Hedge Fund Index
The With Intelligence Short Volatility Hedge Fund Index is an equally weighted index. The index is designed to provide a broad measure of the performance of underlying hedge fund managers who take a net short view on implied volatility with a goal of positive absolute return. The strategy often involves the selling of options to take advantage of the discrepancies in current implied volatility versus expectations of subsequent implied or realized volatility.
With Intelligence Relative Value Volatility Index
The With Intelligence Relative Value Volatility Index is an equally weighted index of 9 constituent funds. The index is designed to provide a broad measure of the performance of underlying hedge fund managers that trade relative value or opportunistic volatility strategies. Managers utilizing the strategy can pursue long, short or neutral views on volatility with a goal of positive absolute return.
With Intelligence Long Volatility Hedge Fund Index
The With Intelligence Long Volatility Hedge Fund Index is an equally weighted index. The index is designed to provide a broad measure of the performance of underlying hedge fund managers who take a net long view on implied volatility with a goal of positive absolute return.
With Intelligence Tail Risk Hedge Fund Index
The With Intelligence Tail Risk Hedge Fund Index is an equally weighted. The index is designed to provide a broad measure of the performance of underlying hedge fund managers that specifically seek to achieve capital appreciation during periods of extreme market stress.
With Intelligence Institutional 200
The With Intelligence Institutional 200 Index is a carefully curated index, designed to reflect the performance of 200 passively chosen large-scale institutional absolute return funds. The construction of this index primarily focuses on the quality of constituents, allocation stability, reduction of selection and survivorship bias.
This index operates on an equal weighting system and undergoes an annual rebalancing at the start of each year. It was established with a base weight of 100 on December 31, 2007. To ensure uniqueness of constituents, the index does not include duplicate funds. Furthermore, it operates in the local currencies of its constituent funds.
Please note that the index's returns and values for the most recent three-month period are considered provisional. These values will only be finalised once all constituent funds have reported their returns.
Initial Requirements for Fund Selection
Unique Funds
Only ‘unique’ funds are included in the index (i.e., no duplicate share classes, currency denominations, or different versions of the same fund, such as onshore and offshore variations, series, etc.). For instance, if our database contains performance data for both the European Absolute Return Fund-USD and the European Absolute Return Fund-EUR, only one set of performance figures would be included in the index. Typically, the fund class with the largest assets under management is selected for inclusion.
Fund must have at least 12-months performance and AUM
A fund must have a minimum of 12-months of track record to be selected for the index.
Continuous track record
A fund must have a continuous performance track record reported into our database to be selected for the index. Exclude non-hedge funds and uncategorized strategies Funds of funds, mutual funds, and uncategorized strategies (i.e. “Other”) are excluded. Funds that don’t charge performance fees are also excluded.
Index creation methodology
AUM Requirement
Fund AUM must be among the largest 300 funds to be included in the final selection process of the index constituents.
Prior constituent priority
Prior year constituents that are among the largest 300 funds at rebalance remain in the index. Rules that prioritise prior constituents over new constituents increase index stability and minimize turnover.
Funds per strategy capped at 80 or 40% of the max constituents
The maximum number of funds to be included in the index per strategy is 80. This is to ensure that the index performance will not be heavily biased by a single strategy, consistent with the expected preferences of institutional hedge fund allocators.
Survivorship bias adjustment
In an event when the index turnover rate exceeds 15% in the 12 months preceding an index rebalancing, we will subtract a calibrated percentage on the monthly return of the index in the following year. This adjustment is designed to incorporate allocators’ ability to subtract or add a limited number of under or outperforming allocations each year.
Other information of the index’s methodology
Monthly index values
The monthly index values are the respective mathematical means (average) of the monthly returns of all hedge fund constituents in the index at that time. Unlike other indices, they are not asset-weighted nor median returns.
Return definition
The returns reported in the database as well as being included and calculated for indices are monthly returns provided by hedge funds monthly. The returns are measured in terms of the gain/loss of the total portfolio values by performance (net of all fees) and net AUM inflow/outflow are excluded from it.
Equal weighting
The index is not asset-weighted. We simply give an overview of the average performance of hedge funds, without attempting to highlight monthly inflows and unjustly overweigh the performance of certain funds due to good marketing staff or location in investor hot spots.
Currency
Equal weighting also encompasses funds denominated in different currencies, such as US dollar, euro and Japanese yen. The index is purely an average of the performance of the constituent funds in their local currencies.