Hedge Funds Continue to Outperform Equities in May

Date: Wednesday, June 11, 2008
Author: Margaret Gilbert, Riskcenter.com

Building on positive gains in April, the Greenwich Global Hedge Fund Index(“GGHFI”) returned +2.01 percent while the Greenwich Composite Investable Index returned +1.66 percent in May. By comparison, the S&P 500, MSCI World Equity, and FTSE 100 indices posted returns of +1.29 percent, +1.11 percent and -0.56 percent, respectively. Year-to-date, the GGHFI has returned +0.49 percent while the S&P 500, MSCI World Equity and FTSE 100 have year-to-date returns of -3.81 percent, -3.98 percent and -6.33 percent, respectively. 83 percent of constituent funds in the GGHFI ended the month with gains.

“Across the board, hedge funds performed well in May. But the real story is told when comparing year-to-date performance,” notes Margaret Gilbert, Managing Director. “Hedge funds are positive for the year compared to the major equity indices which still remain negative.”

Greenwich Global Hedge Fund Index

For the second month in a row, Long/Short Equity managers were the best performing strategy group, posting a gain of +2.35 percent. Directional Trading managers, the best performing strategy group so far this year, exhibited another strong month, returning +2.00 percent. Specialty Strategy managers were the second-best performing strategy group, returning +2.10 percent on average. The Market Neutral Group averaged +1.39 percent on the month as Event Driven managers continued to find opportunities in uncertain markets.

The May Index currently includes 1345 constituent funds. Final May results will be posted at www.greenwichai.com in early June, once additional funds have submitted returns.

Greenwich Investable Index

The Greenwich Investable Index, comprising 49 constituent funds, adds investability, active management, and liquidity to the diversification and performance benefits of the broad Greenwich Global Hedge Fund Index. It references actual hedge fund vehicles as opposed to separately managed accounts or other methods used in an attempt to replicate the returns of hedge fund vehicles. The Investable Index has a correlation of 0.94 and beta of 0.91 to the GGHFI and is reported semi-monthly net of a 0.02 percent per period index calculation fee. Past performance and indices construction rules for all Greenwich Hedge Fund Indices may be viewed at www.greenwichai.com.