Hennessee: Hedge Funds Up 2.51% In January

Feb 8 2012 | 11:56am ET

Hedge funds added 2.51% in January 2012, trailing the S&P 500 which added 4.36%, according to the Hennessee Hedge Fund Index.

“After several months of treading water, managers posted profits as stocks rallied on fundamentals, being driven less by macroeconomic and political news and more by underlying company specific fundamentals,” said Charles Gradante, co-founder of Hennessee Group, in a statement. “The top performing managers were positioned for a January rally and were long stocks that underperformed in 2011.”

Equity long/short was one of January’s best-performing strategies, according to Hennessee, adding 2.47%, as stocks—particularly technology and financials—made gains and U.S. economic data improved.

Arbitrage/event driven funds gained 2.31% during the first month of the year, their best performance since December 2010. All strategies within this category returned positive results in January, as credit markets (with the exception of Treasuries) advanced for the month. Distressed funds added 3.24% in January while merger arbitrage funds gained 1.25% and convertible arbitrage strategies returned 1.91%. 

Global/macro strategies added 2.89% in January. Emerging market hedge funds were top performers for the month, gaining 6.15%. In addition to the European sovereign debt crisis and a possible slowdown in China, managers are closely monitoring the political and social unrest in the Middle East and several have concerns about Iran and Syria. Hennessee’s Macro Index increased 1.46% for the month.  
 


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