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May 28, 2004 at 08:00 PM
NEW YORK (HedgeWorld.com)–World economic factors played a role in the downturn of the CSFB/Tremont* Hedge Fund Index, which fell 0.58% in April and was only up 2.82% for the year through April 30.
Declining U.S. equity markets, fears of interest rate hikes, a slowdown in growth in China, declines in emerging markets and negative high-yield markets contributed to hedge funds’ negative returns, according to a statement from Oliver Schupp, president of Credit Suisse First Boston Tremont Index LLC.
The hedge fund indexes’ performance still was better than that of the general U.S. and world equity markets as a whole. The Dow Jones Industrial Index lost 1.28% in April and was still in negative territory to the tune of 2.18% for the year. The MSCI World Index also lost 1.99% for the month and was up only 0.5% for the year.
Short-bias managers were strong performers, though, returning 4.23% in April. After losing 2.56% in March, the strategy was only up 0.14% for the year. Fixed-income arbitrage also did well in April with a gain of 1.34%, and was the only other strategy to break the 1% mark in April.
Other strategies flirted with negative performance in April. Still posting positive returns were: distressed, 0.66%; event driven, 0.51%; event-driven multi-strategy, 0.47%; convertible arbitrage, 0.46%; multi-strategy, 0.32%; and global macro, 0.14%.
Some of the categories barely posting positive gains during the month were performance leaders year-to-date. Distressed, event driven and event driven multi-strategy reported gains of 4.62%, 4.13% and 3.86% respectively.
Emerging markets, equity market neutral, risk arbitrage, long/short equity and managed futures managers all posted negative numbers in April. The worst monthly performance was from managed futures, which lost 6.46%.
