HFR: Emerging Markets Has Boffo Year

Jan 17 2007 | 3:11pm ET

Echoing the findings of other indices, Hedge Fund Research’s year-end results for its HFRI indices shows emerging markets had a very big year in 2006. The HFRI Emerging Markets (Total) Index ended the year up 24.29%, following a huge December in which it returned 3.47%.

That put it almost 10 points higher than any other strategy tracked by HFRI. Distressed securities ended 2006 up 15.8% (1.6% in December), merger arbitrage 15.67% (1.27% in December) and event-driven 15.3% (1.75% in December).

The overall HFRI Fund Weighted Composite Index returned 12.85% on the year (1.43% in December.

Other HFRI strategy indices include relative value arbitrage (up 12.38% on the year, 1.58% in December), convertible arbitrage (12.17%, 1.18%), equity hedge (11.68%, 1.35%) and macro (8.54%, 1.52%).

The HFRI Fund of Funds Composite Index rose 10.35% in 2006, after December’s 1.72% return. It’s strategic subindex was the best-performing FoF index, returning 11.63% in 2006 (2.06% in December). Rounding out the FoF subindices, diversified rose 10.33% on the year (1.87% in December), conservative 9.1% (1.29%) and market-defensive 8.46% (0.58%).

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Editor's Note