Hedge Funds Rise In April

May 10 2011 | 1:30pm ET

Hedge funds enjoyed broad, if unimpressive, gains in April, a pair of industry indices show.

The average hedge fund added 1.86% on the month, according to Hedge Fund Research's HFRI Fund Weighted Composite Index. While hedge funds badly trailed the Standard & Poor's 500 Index's nearly 3% return, even the Lyxor Hedge Fund Index, generally a pessimistic benchmark, rose 1.37% in April.

The former index is up 3.59% on the year and the latter 2.14%.

Both sets of indices showed gains for most hedge fund strategies; indeed, just two of the 23 strategies and substrategies tracked by the HFRI indices lost ground in April.

Systematic diversified funds led the way for HFRI, rising 4.81% on the month (3.39% year-to-date), while commodity trading advisers were the stars for Lyxor, with long-term managers adding 3.61% and short-term managers 1.87%.

Both sets of indices agreed that it was a good month for macro funds: The HFRI Macro (Total) Index rose 3.36% (2.76% YTD), while the Lyxor Global Macro Index was up 1.81%.

Other strong performers, according to the HFRI indices, included technology and healthcare funds (3.04% in April, 7.28% YTD). Emerging markets funds rose 1.63% (2.62% YTD), equity hedge funds 1.21% (3.48% YTD), event-driven funds 1.15% (4.71% YTD) and relative value funds 0.8% (3.13% YTD).

Only fixed-income convertible arbitrage funds and short-bias funds took a hit in April, according to HFR. The former shed 0.89% (up 1.8% YTD), while the latter slumped 3.15% (down 8.69% YTD).

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