September saw hedge funds post the biggest gains since May 2009, as global equity markets soared on the back of improved investor confidence in the global economic recovery. Approximately USD11 billion flowed into hedge funds reported TrimTabs Investment Reseach and Barclayhedge. According to US-based data provider, Hedge Fund Research, its Composite Index gained +3.37 per cent to leave it at +4.59 per cent YTD, bringing it back to the previous high watermark of October 2007. Macro, Relative Value and Event Driven all posted positive gains but it was Equities that came out on top, gaining +4.5 per cent as word-wide stock markets enjoyed a sharp uptick. Asia ex-Japan hedge funds had one of their best months ever, gaining an incredible +7.81 per cent to easily eradicate earlier loses and leave them up +7.38 per cent YTD.
Fund managers were well positioned to take advantage of the gains achieved in regional markets: MSCI Asia ex-Japan gained 10 per cent, Hong Kong’s Hang Seng Index was up 8.87 per cent, India’s Sensex locked in 11.67 per cent, with Shanghai’s Composite and Thailand’s SET also performing strongly. Figures released this week by Singapore-based research firm, Eurekahedge, confirm that September’s gains (+3.45 per cent) were the best on record, with Asian hedge funds propelling its Index to +5.15 per cent YTD. Regionally, Asia ex-Japan’s Index came out on top, advancing +6.03 per cent (slightly lower than HFR’s figure), way ahead of the second best Index (Emerging Markets); +4.20 per cent. Greater China hedge funds were the biggest winners, up +7.02 per cent. According to HFR, Relative Value is still this year’s best-performing strategy, +7.75 per cent for the year, whilst for Eurekahedge its standout strategy index is Distressed Debt: +10.31 per cent.