Investing January 9, 2002
Hedge Funds Leave Equities in the Dust in 2001
January 9, 2002 (PLANSPONSOR.com) - The Hennessee
Hedge Fund Index increased by 1.6% in December 2001, bringing
its year-to-date return to 4% net of fees, significantly
outperforming most major US and international equity indices,
but lagging Lehman's bond index, which increased by 8.98%
over the year.
Reported by Camilla Klein
According to the Hennessee Group, the winning sub-components of the index in December, were:
- the Latin America Index, which returned 10.01%,
- the Financial Equities Index, which increased by 3.53%, and
- the Value Index, which was up 3.37% over the month
Year to date, the top performing strategies were:
- the Financial Equities Index, which surged by 15.59%,
- Convertible Arbitrage, where managers are typically long on the convertible bond and short the common stock of the same company, hoping to cash in on a pricing anomaly, rose by 15.13%, and
- the Short-Biased, where managers are short more than they are long, which returned 12.65% to investors
In comparison,
- the S&P 500 returned 0.88% in December, while losing 11.89% on a year-to-date basis,
- the Dow Jones Industrial Average increased by 1.73%, while falling by 7.10% over the year,
- the Nasdaq rose by 6.02% over the month, but tallied losses of 21.04% in 2001, and
- the MSCI EAFE rose by 0.58% in December, but lost 22.50% of its value over 2001.