Investing March 14, 2001

Selling Short Pays Off For February Hedge Fund Returns

March 14, 2001 (PLANSPONSOR.com) - The average US hedge fund suffered a 2.5% loss in February, according to Van Hedge Fund Advisors International, outperforming major US indexes for the month.
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Year-to-date through February the Average US and Offshore Hedge Funds have posted slight gains of 0.5% and 1.4%, respectively.

In fact, according to Van Hedge Fund Advisors, almost 50% of hedge funds reporting posted positive returns in February, while over 88% beat the S&P 500 for the month.

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Not surprisingly given the rough markets in February, the best performing strategies were Offshore Short Sellers, US Short Sellers and Offshore Market Neutral-Securities Hedging, which had net returns of 11.5%, 9.3% and 2.0%, respectively.

For the year to date through February, US Emerging Markets Hedge Funds have posted the best net return of 11.9%. Offshore Short Sellers and US Short Sellers have gained 11.6% and 9.4%, respectively.

For the month, the hedge fund returns by investment strategy were:

  • Aggressive Growth off 7.7%
  • Distressed Securities – off 0.3%
  • Emerging Markets – off 2.8%
  • Fund of Funds – off 0.8%
  • Income – up 0.9%     
  • Macro – off 2.7%
  • Market Neutral – Arbitrage – up 0.9%     
  • Market Neutral – Securities Hedging – up 1.7%
  • Market Timing – down 4.2%
  • Opportunistic – down 5.3%
  • Several Strategies – down 1.5%
  • Short Selling – up 9.3%
  • Special Situations – down 0.4%
  • Value – down 2.7%

The hedge fund returns presented are net of fees and performance allocations. The February Index was created using a sample of 742 funds.


 

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