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Barclay Hedge Fund Index up 3.11 per cent in July

Date: Monday, August 17, 2009
Author: Hedgeweek.com

Hedge funds rose 3.11 per cent in July, according to the Barclay Hedge Fund Index compiled by BarclayHedge.

The index now has five consecutive months of gains in 2009 resulting in an increase of 16.23 per cent since 1 March.

'During July, we continued to see improving liquidity, a tightening of credit spreads, and a decrease in risk aversion among investors,' says Sol Waksman, founder and president of BarclayHedge. 'These trends provided support for a continuation of the rallies in global equity and credit markets.'

Overall, 16 of Barclay's 18 hedge fund indices were profitable in July. The Barclay Convertible Arbitrage Index jumped 6.99 per cent, emerging markets gained 5.52 per cent, equity long bias was up 5.34 per cent, the Event Driven Index gained 4.46 per cent, and multi-strategy rose 3.26 per cent.

'Convertible arbitrage has gained 35.38 per cent in 2009, far surpassing last year's 27.66 per cent loss,' says Waksman. 'The index has not had a losing month since November 2008.'

The Barclay Emerging Markets Index has gained 28.23 per cent in 2009, the Event Driven Index is up 18.65 per cent, equity long bias has added 18.37 per cent, and the Multi-Strategy Index is up 16.91 per cent.

The Equity Short Bias Index lost 8.08 per cent in July, and is down 13.22 per cent in 2009. Equity market neutral slid 0.14 per cent and has lost 0.67 per cent year-to-date.

'In spite of the out-sized gains in several hedge fund sectors, many hedge funds remain below previous high water marks and are not yet earning performance fees,' says Waksman. 'If current trends continue, most of last year's losses will soon be recouped by diversified hedge fund investors who stayed the course.'

The Barclay Fund of Funds Index gained 1.51 per cent in July, and is up 5.84 per cent year-to-date.