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Komfie Manalo, Opalesque Asia:

Hedge fund performance was slightly negative during the first week of June, Lyxor Asset Management said in its Weekly Briefing. The Lyxor Hedge Fund Index was slightly down from 30 May to 06 June, dropping -0.2% during the period (+0.4% YTD) from hit by global macro strategies.

Lyxor said that the German Bund yields continued to fall ahead of the ECB meeting, while the stronger EUR weighed moderately on equities. These developments hurt Global Macro funds, positioned in the opposite direction (short EUR and European bonds, long European equities).

"CTAs outperformed for the second week in a row, with all portfolios rewarding," Lyxor said. "The reshuffle of their FX crosses bore fruits (long EUR, neutral GBP). CTAs also benefited as a result of the outperformance of U.S. stocks compared to European indices. Their long positions on fixed income also contributed to positive returns."

It added that event driven funds extended their steady progress. Within the L/S equity space, U.S. funds outperformed EM and market neutral strategies, which remain challenged by sector gyrations.

Macro strategies fell ahead of ECB meeting

On a negative note, macro managers underperformed during the period under review, which precedes the ECB meeting and the UK vote. The reasons for macro underperformance are quite similar to those that explain the positive returns of CTAs but their opposit......................

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