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| News & Scoreboards |
Strong Start for Hedge Funds
04/01/2004
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The Van Global Hedge Fund Index gained 2.1 percent net of fees in January,
according to industry consultant Van Hedge Fund Advisors International.
According to VAN, the return represents the average January performance of over
800 hedge funds from around the world. The index also returned 2.1 percent when
excluding funds of funds. The Van U.S. Hedge Fund Index, which includes only
U.S.-domiciled hedge funds, returned 2.2 percent net for the month, while the
Van Offshore Hedge Fund Index, which includes those funds based outside the
U.S., rose 2.0 percent net.
About 86 percent of the January returns in the
Van Global Hedge Fund Index were positive. Returns ranged from below negative 9
percent to over 22 percent. Hedge fund performance generally fell in line with
that of the stock market in January, as the S&P 500 returned 1.8 percent and
the Nasdaq rose 3.2 percent. About 44 percent of hedge funds in the Global Index
outperformed the S&P 500.
VAN also announced an expansion of its
long-running hedge fund indices with the addition of four new broad strategy
group indices. The new strategy group indices are the market neutral group, the
long/short equity group, the directional trading group and the specialty
strategies group. VAN continues to produce index results for each of the
individual strategies in addition to the new strategy groups. Constituent funds
are equally weighted rather than asset-weighted in each of the indices. VAN
found that some investors and investment managers are interested in seeing not
just how narrowly defined hedge fund strategies perform but also how broader
strategy groups, such as long/short equity, perform.
The long/short equity
group performed best of the four strategy groups, returning 2.5 percent net in
January. The market neutral group averaged 1.8 percent net for the month, while
the specialty strategies and the directional trading groups returned 1.7 percent
net and 1.1 percent net, respectively.
VAN also unveiled a futures strategy
index as well as four arbitrage “substrategy” indices. The new futures strategy
index returned 0.9 percent net in the January global index, reflecting the
average performance of nearly 60 futures funds/commodity pools. Separate account
composites are not included in the futures strategy index.
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