Hedge funds gained 2.84 per cent in January, according to the Barclay Hedge Fund Index compiled by BarclayHedge.

“Fiscal cliff fears receded, European banks strengthened, China avoided a hard landing, Japan stimulated its economy, and global equities rallied,” says Sol Waksman, founder and president of BarclayHedge.

“Economic sentiment continues to improve and investors have moved to ‘risk on’ mode as fears of a euro collapse diminish.”

The Barclay Pacific Rim Equities Index was up 5.23 per cent in January, equity long bias gained 4.13 per cent, European equities added 4.12 per cent, emerging markets were up 3.66 per cent, healthcare and biotechnology gained 3.55 per cent, and the Equity Long/Short Index rose 2.85 per cent
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The Barclay Fund of Funds Index gained 2.08 per cent in January.

Sixteen of Barclay’s 18 hedge fund strategies began 2013 with a gain. On the losing side, equity short bias dropped 8.06 per cent in January and merger arbitrage lost 1.34 per cent. Equity short bias suffered a record loss in 2012, giving up 24.18 per cent for the year.