Widespread Losses Push Hedge Funds Down 0.54%

Jun 9 2011 | 2:19pm ET

Hedge funds were covered in red in May, with almost all strategies posting losses on the month, data from the Hennessee Group shows.

The Hennessee Hedge Fund Index lost 0.54% on the month, its first down month of the year. The index remains up 2.86% year-to-date.

"Most hedge funds lost money in May as risk assets experienced a sharp reversal due to concerns about the global economic recovery.  Commodities took the biggest hit, with silver declining 21% and oil falling 10% during the month,” Lee Hennessee said. “Hedge funds were positioned defensively, which allowed them to protect capital during the sell off.  Several managers used the sell off to add to high conviction core positions and reduce higher beta names."

Only six of the 26 strategies and substrategies tracked by Hennessee were in the black in May, led by healthcare and biotechnologies funds, up 1.77% (7% year-to-date) and short-biased funds, up 1.67% in May but still down 4.88% in a year that has seen the Standard & Poor's 500 Index rise almost 8%. Latin America funds rose 0.83% (down 0.08% YTD), technology funds 0.53% (5.55% YTD) and opportunistic funds 0.11% (2.9% YTD). Merger arbitrage funds were flat on the month (3.37% YTD).

That's all of the good news. Among major strategies, the closest any got to winning was long/short equity, down just 0.09% (up 4.01% YTD). Arbitrage and event-driven funds lost 0.71% (up 2.69% YTD) and global/macro funds 1.16% (up 0.46% YTD).

No strategy had a more miserable May than private investments in public equities and private financing funds, which lost 4.71% on the month to wipe out their year-to-date gains, leaving them down an average of 1.14%. Other prominent losers included macro funds (down 1.95% in May, down 1.42% YTD), international funds (down 1.55%, up 1.32% YTD), telecommunications and media funds (down 1.42%, up 4.85% YTD) and growth funds (down 1.11%, up 4.51% YTD).

On the bright side, despite all of the bloodletting, only five strategies are down on the year.


In Depth

Kettera Q&A: The Advantages of Alternative Investment Platforms

Oct 28 2016 | 5:52pm ET

The past several years have seen a distinct push towards easier and cheaper access...

Lifestyle

Midtown's Plaza District Fades As Manhattan Office Landscape Shifts

Nov 22 2016 | 6:32pm ET

Lower leasing costs, more efficient office space and the hope of projecting an image...

Guest Contributor

Nowhere to Hide: Why the Future of Asset Management Depends on Innovation

Nov 15 2016 | 6:55pm ET

Information technology has reshaped the asset management industry’s periphery,...

 

From the current issue of

Chicago-based independent futures brokerage and clearing firm R.J. O’Brien & Associates (RJO) has hired industry veteran Daniel Staniford as Executive Director, responsible for the firm’s institutional business development in New York and London.

AVAILABLE NOW at BARNES & NOBLE

NEWSTAND LOCATOR