Opalesque Industry Update - Hedge funds posted gains through mid-month with the HFRX Global Hedge Fund Index posting a gain of +0.50%, including a gain of +0.39% on October 10th, the largest 1 day gain in almost 2 years, while the HFRX Market Directional Index rose +1.07%.|
HFRX Equity Hedge Index posted a gain of +0.97% through mid-October, 2013, with gains across Growth, Value and Market Neutral exposures. HFRX Fundamental Value Index rose +1.01% with gains concentrated in European and US large-cap equity, the Index posted a one day gain of +0.85% on October 10th, the largest one day gain since January 2013. HFRX Fundamental Growth Index gained +0.93%, with contributions from exposure to Emerging Asia and small cap US. HFRX Market Neutral Index gained +0.78% with gains as factor-based & trading oriented model captured powerful mean reverting trends.
HFRX Event Driven Index posted a gain of +0.64% through mid-October, led by gains in Special Situations and Merger Arbitrage strategies. HFRX Special Situations Index gained +0.82% for the month, with specific contributions from core positioning in Ferro, Chemtura, Tribune Co., Time Warner, AMC, Hertz, Dish Network, Elan, Dell, Apple, Verizon and Kabel. HFRX Merger Arbitrage Index posted a gain of +0.46%, with contributions from transactions in American Safety/Fairfax, Akorn/Hi-Tech Pharmacal, FNB/BCSB Bancorp, Verizon/Vodafone, Koch/Molex and Thermo Fisher/Life Technologies. HFRX Distressed Index gained +0.17% for the period with contributions from various restructurings across Communications, Energy and Financial sectors.
HFRX Macro Index posted gain of +0.39% through mid-October, with contributions of Currency, Emerging Markets and Fixed Income strategies. HFRX Emerging Markets Index posted a gain of +0.93% with positive contributions from Emerging Asian and Currency strategies. The HFRX Macro: Systematic Diversified Index was essentially unchanged through mid-month, with mixed contributions from equities, fixed income and commodity exposures.
HFRX Relative Value Arbitrage Index posted a modest decline of -0.01% through mid-October as yields rose as investors reduced holdings of short dated treasury securities on continued market uncertainty related to the raise of the debt ceiling and the government shutdown. HFRX Convertible Arbitrage Index gained +0.38% on high yield credit tightening, while the HFRX Fixed Income Credit Index gained +0.26% through mid-month.
Global equity markets posted gains through mid-October, recovering early-month losses through mid-month as financial markets attempted to discount the impact of US fiscal budget impasse, including both the possibilities for resolution, as well as the consequences of failure to resolve. Gains were steady across US caps and sectors, with leadership from Healthcare, Technology and Oil Services. European equities also posted gains led by Spain, Russia and Italy, while Asian equity gains were led by China, India and the Philippines; Emerging Markets were led by gains across the BRIC economies. US yield posted modest increase as some institutions reduced holdings for short dated treasuries on increased default risk, government bond yields were modestly higher across UK Gilts, France, German Bunds, though yields declined across Italy and Spain; though both were narrowly changed, high yield credit tightened while investment grade spreads widened through mid-month. The US dollar traded in a narrow range through mid-month, essentially unchanged against the Euro & Japanese Yen, gaining against the British Pound Sterling while falling against the Brazilian Real & Australian Dollar. Oil & Natural Gas gained through mid-month while Gold & Platinum declined. Agricultural commodities also traded in a narrow range with trading volumes low as a result of the US government shutdowns limiting the release of many reports, gains in Sugar were offset by declines in Lean Hogs.
Comments reference performance as published through October 14, 2013.