Opalesque Industry Update - Hedge funds witnessed a flat to slightly negative performance in June amid reversals in market trends. The Eurekahedge Hedge Fund Index was down 0.19%1 during the month, bringing its June year-to-date performance to 1.33%. In comparison the MSCI World Index was up 3.65%.|
Key highlights for June 2012:
June proved to be a tough month for hedge fund managers with frequent trend reversals and shifts in risk sentiment making it a difficult environment to operate in. The first half of the month witnessed positive movements in the markets amid expectations of stimulus by the US Federal Reserve and the election of pro-bailout parties in Greece. The second half of the month witnessed an increase in risk aversion amid concerns about Spanish banks, but positive developments at the EU summit led to a month-end rally.
Hedge funds under-performed the markets during June, with most losses coming from trend-following strategies with global mandates. Most regional hedge funds delivered positive returns, with managers investing in Eastern Europe and Russia posting the largest gains. The Eurekahedge Eastern Europe & Russia Hedge Fund Index was up 3.83% in June, while the RTS Stock Index gained a strong 8.70%, following a sharp rally on the last trading day of the month. North American and Japanese hedge funds also witnessed positive returns of 0.77% and 2.15% respectively, with most managers gaining from currency exposures and long positions in equity indices and financial stocks. European and Asia ex-Japan hedge funds witnessed losses of 0.15% and 0.43% respectively as many managers had been positioned for greater declines in the markets.