Podcast Center
Video Center
Webcasts
Resource Center
Events
September 17, 2004 at 08:00 PM
NEW YORK (HedgeWorld.com)–Hedge funds meandered back into positive return territory in August–but just barely, according to the CSFB/Tremont* Hedge Fund Index.
Hedge funds broadly finished the month up 0.14% after falling 0.31% in July. For the year through Aug. 31, all hedge funds tracked by the index were up 2.75%. The Standard & Poor’s 500 stock index returned 0.42% year-to-date through Aug. 31.
Of the 10 strategies tracked by the index, seven earned positive returns in August. Equity market neutral funds generated a 2.13% return, while emerging markets funds earned 1.83%. They were tops by far for the month. The next-best performing strategy was dedicated short bias, which earned 1.27%.
Short-bias fund managers caught a cold from rising equity markets after generating an 8.12% return in July, when equity markets fell close to 3%. For the year, they are up 9%, more than any other strategy, which seems logical given the weak performance of equity markets thus far. For the year through Aug. 31, the S&P 500 is up just 0.42%, while the Dow Jones Industrial Index is down 2.68% and the Nasdaq composite index is down 8.25%.
Long/short equity managers, who have been relatively flat all year, continued that trend in August. Oliver Schupp, president of Credit Suisse First Boston Tremont Index LLC, said market activity and the time of year had much to do with long/short managers’ 0.09% return in August.
“August was a volatile month in both the U.S. and European equity markets,” Mr. Schupp said. “Long/Short equity managers ended largely flat for the month, trading on very low volumes, which is typical at the end of summer.”
Event-driven strategies returned 0.45% in August and have returned 5.71% for the year, according to the index. The distressed substrategy was the top event-driven substrategy in August, turning in a 0.56% return. Event-driven multi strategy funds earned 0.38% and risk arbitrage managers earned 0.18%. Year-to-date, those three strategies are up 7.14%, 4.78% and 0.8%, respectively.
Multi-strategy fund managers earned 0.41% in August and are up 2.8% year-to-date. Convertible arbitrage rounded out the list of positive performers last month, earning 0.28% and has earned 0.55% for the year through Aug. 31.
