Barclay Hedge Fund Index Down 3.92% in Sept.

Oct 19 2011 | 9:23am ET

The Barclay Hedge Fund Index shed 3.92% in September, as most hedge fund strategies posted losses for the month.

The September results bring the index’s YTD losses to 6.53%.

“For the second straight month we’re seeing the largest hedge fund losses since the 2008 meltdown,” says Sol Waksman, founder and president of BarclayHedge.

“Equity markets, driven by fear-based liquidation, dropped precipitously. Double-dip concerns drove the S&P 500 to a 7% loss, the MSCI Europe Index gave up 11.1% over the uncertainty of resolution of its sovereign debt issues, and the Hang Seng Index lost more than 15 percent as the Chinese economy appeared to slow.”

September ended in the red for 16 of Barclay’s 18 hedge fund indices. Emerging markets fell 7.61%, equity long bias fell 6.13%, event driven strategies shed 3.91%, healthcare and biotech lost 3.54%, distressed securities 3.33% and Pacific Rim equities fell 3.18%.

Equity short bias was one of the only bright spots—those strategies were up 8.05% in September and 14.34% YTD, proving, said Waksman, that short sellers were "able to capitalize on the lack of confidence that current economic concerns can be resolved in a timely and effective way.”

The Barclay Fund of Funds Index lost 2.78% in September, and is down 5.78% year-to- date.

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