Hedge funds lost 0.24 per cent in April, according to the Barclay Hedge Fund Index compiled by BarclayHedge.
The index is up 1.14 per cent in 2014.
“Intra-month volatility in global equity markets proved troublesome for equity long/short funds as the MSCI World Index dropped three per cent in the first half of the month, yet managed to end the month with a one per cent gain,” says Sol Waksman, founder and president of BarclayHedge.
Twelve of Barclay’s 18 hedge fund indices lost ground in April. The Technology Index dropped 3.68 per cent, Healthcare & Biotechnology fell 3.64 per cent, European Equities lost 1.40 per cent, Equity Long Bias was down 0.97 per cent, and Equity Long/Short lost 0.84 per cent.
“Healthcare and Technology were hit particularly hard as investors continued to rotate holdings out of growth and momentum sectors into defensive sectors,” says Waksman.
Six hedge fund strategies made gains in April. Fixed Income Arbitrage was up 0.73 per cent, Equity Short Bias gained 0.53 per cent, the Event Driven Index added 0.61 per cent, and Convertible Arbitrage gained 0.52 per cent.
“US interest rates continued to decline even as the Fed further reduced its monthly asset purchases,” says Waksman. “As investors have continued to search for yield, the interest rate spread of high yield debt over US Treasuries has narrowed to near pre-crisis levels.”
The Barclay Fund of Funds Index lost 0.79 per cent in April, and is down 0.13 per cent year to date.
The Healthcare & Biotechnology Index is up 5.82 per cent in 2014, Distressed Securities have gained 4.46 per cent, the Event Driven Index is up 3.51 per cent, Fixed Income Arbitrage has added 3.11 per cent, and Convertible Arbitrage is up 2.74 per cent.
The Technology Index has lost 4.16 per cent in 2014, Equity Short Bias Index is down 4.28 per cent, and Pacific Rim Equities have lost 2.69 per cent.