Opalesque Industry Update - Hedge Funds had a modest decline, with the HFRX Global Hedge Fund Index declining -0.09% through mid-April; the HFRX Market Directional also declined modestly by -0.03%. |
The HFRX Relative Value Arbitrage Index posted a gain of +0.39% through mid-month, with positive contributions from Convertible, Multi-Strategy and Corporate Fixed Income strategies. The HFRX RV: Convertible Arbitrage Index gained +1.44% with gains concentrated in exposure to Asia Pacific convertibles, with US & European special situations also contributing to gains. The HFRX RV: Multi-Strategy Index posted a gain of +0.24%, from Commodity Arbitrage strategies and US & Asian credit exposures. The HFRX Fixed Income Credit Index gained +0.33% from exposure to developed economies, partially offset by exposure to emerging markets.
HFRX Macro Index posted a modest decline of -0.02%, with contributions from quantitative Systematic CTA strategies and mixed performance from Fixed Income and Multi-Strategy managers. The HFRX Emerging Markets Index posted a gain of +0.55% with gains in performance in Emerging Asia and Middle East exposures. The HFRX Macro: Systematic Diversified Index posted a modest gain of +0.02% with contributions from long-term trend-following strategies offset by declines in currency strategies.
HFRX Event Driven Index posted a modest decline of -0.04% through mid-April 2013 with contributions from Merger Arbitrage and Distressed strategies, offset by declines in Equity Special Situations managers. M&A activity continued with transactions in FirstMerit/Citizens Republic Bancorp, Liberty Global /Virgin Media, KKR/Gardner Denver, Berkshire/Heinz, Markel/Alterra, with the HFRX Merger Arbitrage Index posting a gain of +0.94%. The HFRX Distressed Index posted a gain of +0.36% as financing for transactions remained accessible and with contributions from exposure in Energy, Consumer and Utilities. The HFRX Special Situations Index declined -0.29% with contributions from transactions in the Energy and Consumer sectors.
HFRX Equity Hedge Index declined -0.69% through mid-April with contributions from Market Neutral strategies offset by declines in Fundamental equity long short managers. The HFRX Market Neutral Index posted a gain of +0.17% from contribution from factor based, trading and behavioral strategies. The HFRX Fundamental Growth Index declined -1.40% from exposure to Communications and Technology sectors and Latin American equity, partially offset by Asian positioning. The HFRX Fundamental Value Index declined -0.40%, from large cap exposure to the US and Europe, partially offset by idiosyncratic positioning in US Cyclical and Financial large cap equity.
Commodities fell sharply through mid-April as Gold posted its worst daily decline in 30 years, while Silver, Platinum and Oil also posted sharp declines. Global equities posted declines as commodities fell, swinging from early month gains to mid-month losses. US equities declined through mid-month, with small cap and growth exposures leading declines; Commodity, Energy, Semiconductors and Telecom posted sharp losses only partially offset by gains in Healthcare & Biotechnology. European equities also posted declines across Germany, France, UK and Russia, with these only partially offset by gains in Italy & Spain. Japanese equities gained again as the Bank of Japan expanded stimulus measures with additional bonds buying and duration increases, extending declines of the Japanese Yen against most currencies; other Asian equities fell across China, India & Korea. The Japanese Yen fell to a 36-month low against the US dollar, but the dollar declined against the Euro, British Pound Sterling and Swiss Franc. As a result of the BoJ stimulus measures, investors aggressively bought government bonds across the US, UK, France, Italy, Spain & Switzerland, driving down yields led by gains in longer dated maturities; both high yield and investment grade credit tightened. Event Driven transactions included Thermo Fisher/Life Technologies, Dish Network/Sprint, Sinclair/Fisher Communications, T-Mobile/MetroPCS, among others.
Comments reference performance as published through April 16, 2013.