HFA Accelerator Plus Ltd, a listed investment company, recorded an impressive return of +24.95% in January, due mainly to a 6.5x leverage level over the underlying fund.
The manager reported that all underlying portfolio strategies produced positive returns, in particular market neutral, equity long/short and relative value strategies.
This result comes as many other absolute return funds actively endeavour to reduce their amount of leverage, in response to extremely poor 2008 returns. It should be noted that although the company was up by almost +25% in January, its 3 month return is currently -31.85% and its 12 month return -65.49%. These figures show that although leverage can be extremely damaging to returns in adverse market conditions, in good times it can significantly increase investor value.
