Hennessee: Hedge Funds Down 1.35% In June

Jul 8 2010 | 2:07pm ET

Hedge funds ended the first half on a sour note, shedding 1.35% in June, according to the Hennessee Group.

The average hedge fund is up just 0.2% on the year following two straight months of negative performance, the Hennessee Hedge Fund Index shows. All three main strategy areas took a hit on the month, with long/short equity funds dropping 1.7% (down 0.14% year-to-date), global macro funds dropping 1.1% (down 1.93% YTD) and arbitrage and event-driven funds dropping 0.67% (up 3.21% YTD).

“As in May, hedge funds continued to decline, amid a broad based reduction of risk and significant volatility.  Hedge fund risk management performed well, with hedge funds declining only one-fourth of traditional benchmarks,” said Lee Hennessee, managing principal of Hennessee Group. “Managers remain cautiously positioned and expect volatility to continue.  While many feel that the market could rally sharply to the upside on positive news, most remain unwilling to assume greater levels of risk in the current environment until they see stabilization.”

Short-bias funds profited from a difficult month for the markets, rising 3.01% in June (1.48% YTD). Fixed-income funds added 0.93% (5.69% YTD), merger arbitrage funds 0.49% (2.1% YTD), convertible arbitrage funds 0.42% (1.8% YTD) and high-yield funds 0.26% (4.42% YTD). Fixed-income funds had the best first-half.

On the other side of the ledger, no strategy took as big a beating in June as financials funds, which plummeted 3.33% (down 0.95% YTD). Event-driven funds did little better, falling 2.82% (up 3.54% YTD) and opportunistic funds fell 2.16% (up 0.21% YTD). European hedge funds are the worst-performers of the half, down 6.46% on the year after a 1.69% June drop.


In Depth

Debunking Conventional Investment Wisdom

Feb 8 2017 | 3:22pm ET

Due diligence in the hedge fund world has long involved some combination of the...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

iCapital Network: The Trump Effect On Direct Lending

Feb 23 2017 | 4:21pm ET

The arrival of the Trump Administration has raised questions among private debt...