Hedge Funds Up 1.68% In August, Led By Convertible Arbitrage

Sep 9 2009 | 12:06pm ET

The average hedge fund is up by double-digits after their sixth straight month of positive performance, early indications from one major industry index shows.

The Credit Suisse/Tremont Hedge Fund Index will finish August up 11.74%, based on preliminary figures from the Credit Suisse Index Co. The index rose 1.68% last month, although Credit Suisse noted a “wide dispersion in returns,” with short-sellers doing better amidst August’s volatility.

Convertible arbitrage funds remained the best-performing strategy of the year, rising 3.37% last month to reach 35.57% on the year.  Event-driven funds also did well, rising 2.46% on the month (11.81% year-to-date). Event-driven multi-strategy funds did especially well, adding 2.61% (12.19% YTD).

Fixed-income arbitrage funds added 2.39% on average in August (18.68% YTD), while distressed funds rose 2.2% (11.11% YTD) and equity market-neutral funds returned 2.18% (5.15% YTD).

Long/short equity funds rose 1.42% last month (13.02% YTD) and global macro funds added 0.94% (6.22% YTD).

Just one strategy was in the red in August: Dedicated short-bias, which continued to be battered by rising markets, falling 1.69%. But that’s much better than the 7.26% decline such funds suffered in July. Still, the strategy is down 18.67% on the year.

Only one other strategy tracked by Credit Suisse is in the red through August: Managed futures, whose 0.79% August return wasn’t nearly enough to bring it out of its 7.1% hole.


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