A Very Bad Year: Hedge Funds Down More Than 4%

Jan 9 2012 | 2:36pm ET

Hedge funds closed out 2011 in fitting fashion, ending one of the industry's worst years ever with further losses.

The Hennessee Hedge Fund Index lost 0.6% in December, its seventh losing month of the year, to finish 2011 down 4.27%. All but seven of the 23 strategies and substrategies tracked by the Hennessee Group ended last year in the red, and only six of the 21 subindices reporting for December were up on the month—and none more than healthcare and biotechnology's 0.84%.

"It was a disappointing year for hedge funds as they underperformed broad market returns for the second year in a row," Hennessee's Charles Gradante said. "Hedge fund managers describe 2011 as 'more frustrating than 2008.'"

Short-biased funds enjoyed the strongest year, adding 3.95% (down 1.33% in December). Market neutral funds rose 3.71% (down 0.21% in Dec.) and fixed-income funds 3.6% (up 0.14% in Dec.). Healthcare and biotech added 1.9%, high-yield 1.59% (down 0.38% in Dec.), technology 1.22% (up 0.37% in Dec.) and merger arbitrage 0.18% (down 0.08% in Dec.).

On the other hand, emerging markets and Europe funds were hardest hit, losing 12.85% on the year (down 0.55% and 0.32% in Dec., respectively). Also a double-digit loser: Financial equities funds, which lost an average of 11.54% (down 2.45% in Dec.).


In Depth

Q&A: Pantheon’s McCrary Says Private Equity Market ‘Robust’

Dec 17 2014 | 8:32am ET

Dennis McCrary is a partner at Pantheon, a private equity firm with $32.2 billion...

Lifestyle

Cohen Donates $1.5M To GOP Governors Association

Dec 10 2014 | 7:13am ET

The Republican Governors Association raised close to $25 million from October 1...

Guest Contributor

Q&A With Daniel Gallancy: Institutional Interest In Bitcoin Is Growing Steadily

Dec 12 2014 | 7:54am ET

Daniel Gallancy is founder and CEO of SolidX, a provider of total return swaps for...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.