Hedge funds lost 0.54 per cent in August, according to the Barclay Hedge Fund Index compiled by BarclayHedge.
The index has a positive return of 5.22 per cent year to date.
“Uncertainty over the Fed’s tapering timeline and possible US military intervention in Syria were primary drivers of an August global equities sell-off,” says Sol Waksman, founder and president of BarclayHedge. “The MSCI World Index was down 2.1 per cent at month-end.”
Returns for hedge fund strategies were mixed in August, with ten of Barclay’s hedge fund indices losing ground while eight had gains.
The Emerging Markets Index lost 1.37 per cent, Global Macro Index gave up 1.27 per cent, Equity Long Bias was down 0.74 per cent, and the Equity Long/Short Index slipped 0.59 per cent.
“Rising US interest rates raised fears of fund outflows from net debtor emerging countries that rely on foreign investment,” says Waksman.
On the positive side, the Barclay Equity Short Bias Index gained 3.04 per cent, Fixed Income Arbitrage was up 0.73 per cent, Convertible Arbitrage rose 0.69 per cent, and the Technology Index added 0.62 per cent.
Year to date the strongest performing hedge fund strategy is healthcare and biotechnology, which has gained 15.97 per cent. Pacific Rim equities are up 14.35 per cent, equity long bias index has gained 11.42 per cent, and distressed securities have returned 10.64 per cent.
Despite the jump by Equity Short Bias in August, the index remains down 17.05 per cent for the year. Emerging Markets have lost 1.74 per cent after eight months.
The Barclay Fund of Funds Index lost 0.69 per cent in August, but remains up 3.52 per cent year to date.