Opalesque Industry Updates - After being marginally down in January, hedge funds returned to positive territory in February 2010. The composite Eurekahedge Hedge Fund Index gained 0.52% during the month as the underlying global markets posted a recovery from a disappointing January. The MSCI World Index was up 1.23% in February, bringing its YTD figure to -3.01%.|
Hedge fund start-up activity gears up with nearly 90 launches globally in 1Q2010.
Arbitrage hedge funds delivered 15 consecutive months of positive returns, gaining 26.23% since November 2008.
Hedge fund returns across most regions were marginally positive for February; however, early reports showed that North American managers, who make up 65% of the hedge fund universe, posted impressive gains of 1.41%. Regional managers capitalised on the marked improvements in market sentiment on the back of some strong earnings reports, positive movements in the US dollar and commodities as well as improved manufacturing data and the Fed’s decision to maintain low interest rates.
Latin American funds were also positive with a 0.48% returns in February while Asia ex-Japan and Japan funds returned nominally positive performances. Continued problems in the eurozone led to negative results by the region’s managers, who were down 0.66% in February as the euro weakened amid speculation of Greece’s sovereign debt default.
Similar to regional mandate returns, most strategic indices changed slightly in February, albeit on the positive side. The best performers were CTA managers, who navigated skillfully through choppy crude oil prices while gains in the commodity sector and the US dollar also proved profitable for most funds. The Eurekahedge CTA/Managed Futures Hedge Fund Index was up a strong 1.27% during the month. Continued low interest rates in the US also helped managers in the bonds sector to deliver yet another month of positive results. Fixed income, arbitrage and relative value hedge funds were all up during the month while distressed debt managers were flat to slightly negative.
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