Hedge funds suffered a through a tough October, with only event-driven funds providing a glimmer of good news, according to an industry replication index.
The Credit Suisse Liquid Alternative Beta Index dropped 0.64% last month. After a year of trailing the Standard & Poor's 500 Index, the benchmark managed to beat it in October, but only by missing out on the broader market's full decline.
The index is up only 2.31% on the year, and in October, event-driven "was the sole contributor to performance, finishing up 0.94% for the month," Jordan Drachman, head of alternative beta strategies at Credit Suisse said. Drachman also noted that, with a return of 9.12% on the year, event-driven "continues to be the highest-performing strategy" in 2012.
The other four strategies tracked by the LAB indices were in the red on the month. Managed futures funds fell 2.41% (down 8.84% year-to-date), and long/short funds lost 2.01% (up 2.94% YTD). Merger arbitrage funds dropped 1.28% in October (down 4.18% YTD) and global strategies shed 0.86% (down 0.53% YTD).