CHICAGO (HedgeWorld.com)–Hedge funds held their own in February, but yielded little in the way of substantial returns in the last month.
Major hedge fund indexes reported gains below 1% across the board as convertible arbitrage, emerging market and global macro sectors recorded most of the industry’s gains.
“January’s rising market trend in the U.S. equity market stalled in February, and performance was almost unchanged,” said Oliver Schupp, president of Credit Suisse/Tremont Hedge Fund Index, in a statement. The Credit Suisse/Tremont index was up 0.34% in February and the investable version of the index gained just 0.28%.
As a result of the U.S. equity markets’ poor performance, long/short equity managers were unable to benefit on their net long positions, officials said. Short-bias managers also have suffered, dipping into negative territory with a loss of 2.6% for the year.
Managers with a global focus seem to be on top right now. For the first two months of 2006, emerging markets managers reigned supreme in the Credit Suisse/Tremont index with a 7.42% gain through Feb. 28. Six funds with an Asia investment focus were moved from the long/short equity sector to emerging markets. They are: Henderson Asia Pacific Absolute Return Fund Ltd.; Boyer Allan Pacific Fund; Martin Currie Absolute Return Asia Fund Partnership LP; Sofaer Capital Asian Hedge Fund; Tiedemann/Ayer Asian Growth and Wessex Asia Pacific Fund Ltd.
Global macro managers gained 1.23% in the Credit Suisse/Tremont index thanks to short positions in U.S. bonds. On the equity side, the Standard & Poor’s Hedge Fund Index returns showed global ex-U.S. long/short equity managers up 5.37% after a good January.