HFRX Interim Update: Hedge Funds Up Through Mid-January

Jan 19 2017 | 11:23pm ET

Hedge fund performance has been generally positive through the first half of January as financial markets continue discounting, and in some cases tempering, expectations of the Trump administration, according to flash update from Hedge Fund Research. 

The company’s widely followed HFRX Global Hedge Fund Index gained +0.31% for the month through January 17, while its HFRX Market Directional and HFRX Equal Weighted Strategies indexes rose +1.03% and +0.30%, respectively.

Key highlights from HFR’s update:

  • The HFRX Event Driven Index posted a gain of +1.15% through mid-January from gains in Special Situations equity and Distressed/Restructuring managers. The HFRX Special Situations Index posted gain of +1.34% from core positioning in Yahoo, Alibaba, Penn West, ClubCorp, NXP Semiconductors and Reynolds American, while the HFRX Distressed Index rose +0.69% from exposure to the U.S. Consumer, Industrial and Technology sectors. The HFRX Merger Arbitrage Index had a narrow decline of -0.12% with core exposures to Suffolk/People's United Financial, Samsung/Harman Int. and Symantec/LifeLock transactions. 
  • The HFRX Equity Hedge Index posted a gain of +0.77% in the period as global equity markets rose through mid-month. The HFRX Fundamental Growth Index posted a gain of +1.62% from gains in Global Healthcare, Emerging Asia and Latin America exposure. The HFRX Fundamental Value Index rose +0.48% from gains in U.S. large-caps in the Consumer, Technology and Communication sectors. The HFRX Market Neutral Index gained +0.13% with contributions from mean reverting, factor based strategies and fundamental managers. 
  • The HFRX Relative Value Arbitrage Index gained of +0.51% through mid-January on strength in Convertible and Fixed Income strategies. The HFRX Convertible Arbitrage Index gained +0.90% through mid-month on declining yields that were partially offset by declines in volatility. The HFRX RV: Multi-Strategy Index and the HFRX Fixed Income - Credit Index gained +0.44% and +0.30%, respectively, as yields declined modestly for the period. 
  • The HFRX Macro/CTA Index remains the outlier, posting a decline of -1.80% through mid-January from systematic trend-following managers as Energy commodities declined, Metals and Agriculturals posted gains, the British pound recovered and the USD declined. 

Established in 1992, HFR is a global leader in specializing in the indexation and analysis of hedge funds. The company produces the HFRI, HFRX and HFRU Indices, industry benchmarks for global hedge fund performance, and calculates over 100 indices ranging from industry-aggregate levels down to specific, niche areas of sub-strategy and regional investment focus.

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