Key Takeaways
- • The Dow Jones Credit Suisse Hedge Fund Index posted an estimated gain of 1.67% in July 2010, lifting year-to-date performance to 2.32%, according to early estimates from Credit Suisse based on 76% of index component assets reporting.
- • Long/Short Equity was the strongest strategy, gaining 2.82% in July after a 2.07% decline in June, as directional net-long managers benefited from a beta-driven market.
- • Managed Futures was the main laggard, falling 1.49% as trend followers were caught long US dollars, gold, or short wheat.
- • Dedicated Short Bias declined 2.62% in July, reversing a 5.45% gain in June, while Global Macro rose 0.66% after a late-month recovery.
- • Final July figures were scheduled for publication on August 16 on Bloomberg and at www.hedgeindex.com.
Summary
Credit Suisse Hedge Index LLC reported in a press release dated August 9, 2010 that the Dow Jones Credit Suisse Hedge Fund Index (the "Broad Index") was estimated to have gained 1.67% in July. The estimate is based on 76% of the assets of index component hedge funds reporting. The gain followed a decline of 0.84% in June and brought year-to-date performance to 2.32%. The release said hedge funds rebounded along with overall markets during the month.
Long/Short Equity funds posted the strongest result among the major strategies, rising 2.82%. Credit Suisse attributed the gain to directional net-long managers benefiting from a beta-driven environment, supported by positive second-quarter corporate earnings and upbeat sentiment following Eurozone bank stress test results. Event Driven strategies gained 1.81%, with Distressed up 1.55%, Event Driven Multi-Strategy up 1.91%, and Risk Arbitrage up 2.11%. Emerging Markets rose 2.92%, Convertible Arbitrage gained 2.03%, Equity Market Neutral gained 2.41%, Fixed Income Arbitrage rose 1.30%, and Multi-Strategy gained 2.06%.
Global Macro managers struggled early in the month but recovered in the second half to finish up 0.66%, capitalizing on FX movements and positive commodities performance, particularly in wheat, coffee and industrial metals. Managed Futures finished down 1.49% as many trend followers were positioned long US dollars, gold or short wheat. Dedicated Short Bias was the weakest strategy, falling 2.62%.
For comparison, the release cited the Dow Jones Global Index up 7.90% in July, the Barclays Capital Aggregate Bond Index up 3.40%, and the DJ-UBS Total Return Commodities Index up 6.77%. Final July performance is to be published August 16 on Bloomberg and online at www.hedgeindex.com.
Long/Short Equity funds posted the strongest result among the major strategies, rising 2.82%. Credit Suisse attributed the gain to directional net-long managers benefiting from a beta-driven environment, supported by positive second-quarter corporate earnings and upbeat sentiment following Eurozone bank stress test results. Event Driven strategies gained 1.81%, with Distressed up 1.55%, Event Driven Multi-Strategy up 1.91%, and Risk Arbitrage up 2.11%. Emerging Markets rose 2.92%, Convertible Arbitrage gained 2.03%, Equity Market Neutral gained 2.41%, Fixed Income Arbitrage rose 1.30%, and Multi-Strategy gained 2.06%.
Global Macro managers struggled early in the month but recovered in the second half to finish up 0.66%, capitalizing on FX movements and positive commodities performance, particularly in wheat, coffee and industrial metals. Managed Futures finished down 1.49% as many trend followers were positioned long US dollars, gold or short wheat. Dedicated Short Bias was the weakest strategy, falling 2.62%.
For comparison, the release cited the Dow Jones Global Index up 7.90% in July, the Barclays Capital Aggregate Bond Index up 3.40%, and the DJ-UBS Total Return Commodities Index up 6.77%. Final July performance is to be published August 16 on Bloomberg and online at www.hedgeindex.com.
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