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Komfie Manalo, Opalesque Asia:

Recent improvements in risk appetite provided a welcome relief to hedge fund strategies that suffered the most during the selloff. Lyxor Asset Management reported that it was another week of positive results for hedge funds, fuelled by the risk on market sentiment, with the Lyxor Hedge Fund Index gaining 0.6% (-1.9% YTD) as of Mar. 01.

Value long/short equity managers experienced a strong rebound since mid-February, after a challenging start to the year. Some value managers are up 10% in three weeks. Event driven managers also benefited from the market rally, particularly special situation funds. The Lyxor Special Situations Index is up 1% for the same week (-5.8%YTD).

Philippe Ferreira, a senior strategist at Lyxor AM, commented, "The good news is that the twist in risk appetite did not hurt strategies that were resilient during the selloff. For instance, the Lyxor CTA Broad Index, which is up +4.3% YTD, is down only -0.2% last week. This is due to the fact that their margin to equity has been far below average, i.e. they have low exposures across asset classes."

Event driven also outperformed, driven by both merger arbitrage (+0.9%) and special situations. Long/short equity managers (+0.7%) continued to be boosted by U.S. long bias funds. Market neutral funds were up 1.2% while variable bias funds recorded mixed results. CTAs were resilient (-0.2%) despite market gyrations thanks t......................

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