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Hedge fund industry gains 2.04% in June as almost all hedge fund sectors have positive month

Wednesday, July 15, 2020
Opalesque Industry Update - Hedge funds continued their positive ways in June, riding a continuing stock market recovery and reopening economies to a 2.04% monthly return, according to the Barclay Hedge Fund Index, compiled by BarclayHedge, a division of Backstop Solutions. By comparison, the S&P 500 Total Return Index was up 1.99% in June.

Year-to-date, the hedge fund industry was down 2.71%. The S&P 500 Total Return Index was down 3.08% over the same period.

All sectors but one tracked by the Barclay Hedge Fund Indices were in the black for June. The lone exception was the Volatility Trading Index, which was down 1.23% for the month.

In spite of continuing bad news regarding the COVID-19 pandemic, there were encouraging economic signs in June. Businesses began to reopen and there were indications that the pandemic's economic impact might have done its worst. The economy was beginning to turn upward.

"Although pandemic concerns remained, stock markets experienced their best quarter in more than 20 years, significantly recovering their pandemic losses" said Sol Waksman, president of BarclayHedge. "Businesses continued to reopen slowly and US retail sales jumped prompting optimism that the COVID recession might be short-lived."

As China reopened, the country's economic activity accelerated. Other Asian economies followed suit. The Emerging Markets Global Equities Index led the pack in June with a 5.65% return. Several other emerging markets indices were among June's leading gainers, including the Emerging Markets Asian Equities Index, advancing 5.53% and the Emerging Markets Latin American Equities Index, gaining 4.81%.

Other notable gains were seen in the Technology Index, up 4.74% and the Emerging Markets Index, gaining 4.37%.

Although most hedge fund sectors remained in the red for the year-to-date through June, 8 posted gains. Leading the gainers were the Technology Index, up 9.75%, the Volatility Trading Index, gaining 8.71%, the Emerging Markets Global Fixed Income Index, posting an 8.19% return, and the Healthcare & Biotechnology Index, up 5.37%.

The Emerging Markets Latin American Equities Index posted the largest year-to-date percentage drop through June, down 18.22%. The Emerging Markets MENA Index was off 12.14% through June, the Emerging Markets Global Equities Index was down 10.18%, the Emerging Markets Eastern European Equities Index dropped 9.57%., and the Pacific Rim Equities Index was down 9.51%.

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