Hedge funds fell to open 2014—but not as much as the broader markets.
The average hedge fund shed 0.24% in January, according to Hedge Fund Research's HFRX Global Hedge Fund Index. But the benchmark managed something it rarely accomplished last year: besting the Standard & Poor's 500 Index, which fell more than 3% last month.
Despite the overall decline, most strategies tracked by the HFRX suite were in the black in January, led by master-limited partnerships—last year's best-performing strategy at 26.35%—which returned 1.58%. Distressed restructuring funds gained 1.08%, equity-market neutral funds 0.72%, convertible arbitrage funds 0.64%, credit funds 0.6%, event-driven funds 0.39%, fundamental growth funds 0.36%, systematic diversified commodity trading advisers 0.2%, special situations funds 0.17% and merger arbitrage funds 0.09%.
Fundamental value funds were hardest hit last month, falling 1.73%. Equity hedge funds shed 1.01%, emerging markets funds 0.87%, multi-strategy funds 0.38%, relative-value arbitrage funds 0.2% and macro funds and CTAs 0.07%.