Hedge funds gained 0.78 per cent in February, according to the Barclay Hedge Fund Index compiled by BarclayHedge.
Hedge funds are up 0.42 per cent year-to-date, after gaining 23.74 per cent in 2009.
“Hedge funds bounced back in February, more than making up for their 0.34 per cent loss in January,” says Sol Waksman, founder and president of BarclayHedge. “While US and Asian equity markets gained ground in February, European-linked assets underperformed due to concerns about sovereign debt default in Greece and fears of possible contagion impacting the weaker European Union members.”
Overall, 15 of Barclay’s 18 hedge fund indices had a positive return in February.
The Barclay Technology Index was up 2.30 per cent, equity long bias was up 1.66 per cent, healthcare and biotechnology gained 1.25 per cent, and the Event Driven Index rose 0.98 per cent.
The Barclay Distressed Securities Index is up 3.19 per cent in the first two months of 2010. Distressed securities gained 30.89 per cent in 2009.
“Bond prices moved higher following Bernanke’s mid-month congressional testimony where he reiterated the Fed’s commitment to maintain low interest rates for an ‘extended period’ of time,” says Waksman. “Rising bond prices typically provide a favourable environment for distressed securities.”
On the losing side, equity short bias was down 2.02 per cent in February, European equities lost 
0.62 per cent, and Pacific Rim equities slipped 0.09 per cent.
The Barclay Fund of Funds Index gained 0.17 per cent in February.
