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Portfolio > Alternative Investments > Private Equity

Long/Short Equity Bruised by May Tumbles

By Staff Writer

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NEW YORK (HedgeWorld.com)–Equity long/short managers in the Dow Jones Hedge Fund Indexes took it on the chin in what turned out to be a tough month for markets in general.

The strategy, which as of April was the index’s top performer year-to-date, decreased by 3.53% in May, slashing its year-to-date performance to 3.76%–still in positive territory. At the end of April, equity long/short was up 7.55% year-to-date.

Faring somewhat better were the other two losing strategies, event-driven and merger arbitrage, which declined 0.51% and 0.48%, respectively. Event-driven managers remain on good footing year-to-date, up 4.98%, while merger arbitrage is still up 3.98%.

The strongest-performing strategy in May was distressed securities, which doubled its April results to pull in a 2.05% gain and boost its year-to-date return to 7.26%, making it the new leader among the Dow Jones-tracked categories.

Convertible arbitrage managers managed a 0.83% increase, building year-to-date results to 4.93%. Equity market neutral treaded water with a 0.08% return for the month and 2.5% for the year so far.

By and large, the Dow Jones Hedge Fund Indexes did better than comparison indexes. The Dow Jones Wilshire 5000 on a float-adjusted basis fell 3.21% in May, while world equity markets measured by the Dow Jones World Total Market Index fell 4.18%, though still positive 6.15% on the year. The Dow Jones Corporate Bond Index fell 0.34%.

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Contact Bob Keane with questions or comments at [email protected].

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