Opalesque Industry Update - Hedge funds gained 1.23% in December, according to the Barclay Hedge Fund Index compiled by BarclayHedge. The Index gained 11.21% in 2013.|
“The US Fed announced in December that it would reduce Quantitative Easing purchases from $85 billion to $75 billion per month, and assured market participants that until certain growth rates and unemployment levels were achieved, interest rates would remain low,” says Sol Waksman, founder and president of BarclayHedge.
“Equity prices in the US and Europe rallied on the news and the S&P 500 reached a record high on the final trading day of the year."
Overall, 17 of Barclay’s 18 hedge fund indices had gains in December. The Barclay Technology Index gained 2.05%, Pacific Rim Equities were up 2.05%, Equity Long Bias gained 1.98%, the Healthcare & Biotechnology Index was up 1.91%, Equity Long/Short rose 1.72%, and Distressed Securities added 0.97%.
The leading hedge fund index in 2013 was Healthcare & Biotechnology, which gained 28.98%. Pacific Rim Equities were up 23.14%, Equity Long Bias Index returned 21.52%, and Distressed Securities gained 16.62% for the year.
The Equity Short Bias Index fell 2.46% in December, and was the only hedge fund strategy with a loss in 2013. Short Bias ended the year 27.15% in the red, surpassing last year’s record loss of 24.12%.
“The S&P 500 had its best year since 1997 when it gained 33.38 percent,” says Waksman. “For traders on the short side of the market, swimming against a strong current can be treacherous.”
The Barclay Fund of Funds Index gained 1.08% in December, and was up 8.46% in 2013.