With five of the six hedge fund strategies covered by Dow Jones Hedge Fund Indexes posting net of fees losses in July and the only exception, merger arbitrage, returning just 0.05 per cent
With five of the six hedge fund strategies covered by Dow Jones Hedge Fund Indexes posting net of fees losses in July and the only exception, merger arbitrage, returning just 0.05 per cent, July was the poorest month in 2008 for the performance of hedge fund strategies, according to Dow Jones Indexes.
The cumulative year to date gain by merger arbitrage of a meagre 0.49 per cent left it behind only equity market neutral, which saw its performance so far in 2008 trimmed to 0.82 per cent after a decline of 0.65 per cent last month.
Distressed securities and convertible arbitrage saw declines in July of 1.31 and 1.83 per cent respectively, bringing their cumulative losses for the year to 6.80 and 7.71 per cent, the worst performance of the Dow Jones Hedge Fund Indexes strategies.
Event-driven was down 2.18 per cent in July, pulling the strategy back into negative territory for the year with a decline of 2.14 per cent. Equity long/short, previously 2008’s top strategy after a scintillating second quarter, performed worst in July, falling 4.17 per cent and pushing its cumulative 2008 performance into 1.73 per cent deficit.
Dow Jones notes that other asset classes performed better in July, but equities still substantially underperformed hedge funds over the first seven months of the year. On a float-adjusted basis, the Dow Jones Wilshire 5000, a measure of the US equity market, lost 0.86 per last month and is now down 11.69 per cent this year.
The Dow Jones Corporate Bond Index fell 0.52 per cent in July for a cumulative year to date decline of 0.40 per cent, while the Dow Jones Wilshire Global Index, a measure of global equity markets, slipped 2.47 per cent for the month and now has lost 12.93 per cent in 2008.
The July figures for the Dow Jones Hedge Fund Strategy Benchmarks are based on daily estimates net of fees. Final performance figures for July will be available towards the end of August.
