Monday, 28 July 2014
Last updated 2 days ago
Aug 8 2013 | 10:34am ET
Hedge funds enjoyed broadly positive returns in July, according to a report from Hedge Fund Research.
The HFRI Fund Weighted Composite Index rose 1.36% last month and is up 4.73% on the year. Most strategies tracked by the index suite were in the black in July.
“In sharp contrast to the volatile, risk-off sentiment of the prior month, hedge fund performance in July was driven by a positive tone to earnings season and a dynamic environment for M&A including strategic transactions, shareholder activist and special situations exposures, contributing to a favorable operating environment for long/short strategies,” HFR President Kenneth Heinz said. “While many managers continue to position for a gradual extraction of stimulus measures by the U.S. Federal Reserve and correspondingly rising bond yields, fundamentally-driven, valuation-oriented strategies produced strong results in July as risk-off sentiment moderated from the prior month and investor risk tolerance continued to normalize."
The strongest returns were posted by technology and healthcare funds, which rose an average of 4.04% (12.37% year-to-date). Energy and basic materials funds added 3.67% (down 1.29% YTD), equity hedge funds 2.5% (7.68% YTD), Russian and Eastern European funds 1.91% (down 1.04% YTD), quantitative directional funds 1.69% (4.19% YTD) and event-driven funds 1.54% (7.02% YTD).
Distressed and restructuring funds rose 1.41% (8.54% YTD), merger arbitrage 0.98% (2.47% YTD), emerging markets 0.7% (0.42% YTD), equity-market neutral 0.61% (3.4% YTD), relative-value 0.42% (3.43% YTD), convertible arbitrage 0.32% (4.56% YTD) and multi-strategy 0.23% (4.5% YTD).
With the Standard & Poor's 500 Index soaring 5% in July, short-bias funds were the month's biggest loser, falling 2.87% (down 12.65% YTD). Systematic diversified funds lost 1.07% (down 1.99%), Latin America funds 0.36% (down 6.37% YTD), corporate fixed-income funds 0.17% (up 1.33% YTD) and macro funds 0.11% (down 0.98% YTD).
The HFRI Fund of Funds Composite Index rose 1.27% on the month (4.77% YTD).
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…