Hedge funds lost 0.29 per cent in January, according to the Barclay Hedge Fund Index compiled by BarclayHedge.
The index gained 11.11 per cent in 2013.
“After a rousing end to 2013, January bore witness to a complete reversal of key trends as investor sentiment turned defensive,” says Sol Waksman, founder and president of BarclayHedge. “Global equity markets sold off as emerging markets came under renewed pressure from slowing in China, political unrest in Thailand and Turkey, and currency devaluation in Argentina."
Overall performance by hedge fund sector was mixed in January. Twelve of Barclay’s 18 hedge fund indices had gains, while six indices had losses.
The Barclay Healthcare & Biotechnology Index jumped 5.97 per cent in January, its largest one-month return since posting a gain of 6.27 per cent in May of 2009.
“The healthcare sector was a beneficiary of the move by investors out of cyclical stocks and into defensive stocks,” says Waksman.
The Barclay Equity Short Bias was up 1.95 per cent in January, Distressed Securities gained 1.55 per cent, European Equities were up 1.20 per cent, Convertible Arbitrage gained 1.10 per cent, and Fixed Income Arbitrage rose 0.94 per cent.
In contrast, the Emerging Markets Index lost 2.47 per cent, Pacific Rim Equities were down 0.96 per cent, Equity Long Bias gave up 0.86 per cent, and Global Macro lost 0.55 per cent.
The Barclay Fund of Funds Index was down 0.36 per cent in January.