Key highlights for the month:
Source
Early View: Dow Jones Credit Suisse Hedge Fund Index Estimated Up 3.01% in December
- Hedge Funds bounced back after muted performance in November, as the Dow Jones Credit Suisse Hedge Fund index rose an estimated 3.01%. Nine out of ten sectors posted positive performance for the month. The industry is expected to finish up 11.07% for the year.
- The Event Driven sector posted the strong performance in December due primarily to increased opportunities in the special situations arena. The largest gains were seen in the Distressed and Multi-Strategy sub-indices which were up 2.34% and 5.27% respectively.
- Global Macro funds were also among the top performers for the month finishing up 2.75%. Managers found profitability in FX trades, where many shorted the USD against other emerging markets currencies. Managers also added alpha via commodities with long precious metal positions.
- Managed Futures funds posted positive performance of 5.50%, helping the sector to recoup November losses. Performance was largely driven by gains from short term models, which were able to capture strong momentum in both equities and commodities.
| Index | Dec-10 | Nov-10 | 2010 |
| Dow Jones Credit Suisse Hedge Fund Index | 3.01% | -0.18% | 11.07% |
| Convertible Arbitrage | 1.14% | 0.04% | 10.95% |
| Dedicated Short Bias | -5.94% | -2.36% | -22.52% |
| Emerging Markets | 1.71% | -0.38% | 11.56% |
| Equity Market Neutral | 2.22% | -2.51% | -0.37% |
| Event Driven | 4.16% | 0.15% | 12.89% |
| Distressed | 2.34% | 0.33% | 9.84% |
| Event Driven Multi-Strategy | 5.27% | 0.04% | 14.90% |
| Risk Arbitrage | 1.24% | -1.44% | 3.26% |
| Fixed Income Arbitrage | 0.63% | 0.74% | 12.50% |
| Global Macro | 2.75% | -0.52% | 13.54% |
| Long/Short Equity | 3.41% | 0.46% | 9.26% |
| Managed Futures | 5.50% | -4.11% | 12.28% |
| Multi-Strategy | 1.79% | 0.30% | 9.38% |
| Dow Jones Global Index | 7.38% | -2.16% | 11.89% |
| Barclays Capital Aggregate Bond Index | 1.31% | -3.81% | 5.54% |
| DJ-UBS Total Return Commodities Index | 10.69% | -0.35% | 16.83% |