Event-Driven Managers Lead MSCI Index Returns in December

NEW YORK (HedgeWorld.com)–Event-driven and specialist credit managers boosted the MSCI strategy indexes out of the doldrums in 2004.

The MSCI Multi-Process Group Index posted a 2.3% gain in December. The index includes event-driven managers and investment approaches where a single investment process does not account for more than 80% of a manager’s risk capital. In 2004, the Multi-Process Group was up 11%, substantially less than the 18.9% the index returned in 2003.

The best-performing MSCI hedge fund index in 2004 was the MSCI Specialist Credit Index. It gained 1.5% last month and was up 12.3% for the year. A grouping of strategies such as distressed securities, the specialist credit tally came the closest of all the indexes to reaching the performance of the equity markets.

The MSCI Hedge Fund Composite Index was up 1.3% last month and rose 6.6% for 2004, with 63% of the underlying funds reporting their returns to the index company. Hedge funds were still lagging long-only equities, as the MSCI World Equity Index moved up by 3.8% in December and was up 14.7% for the year ended Dec. 31.