Hedge fund industry down 0.65 per cent in September, says Backstop BarclayHedge

After five straight months in the black, hedge funds posted a negative number in September losing 0.65 per cent for the month, according to the Barclay Hedge Fund Index, compiled by BarclayHedge, a division of Backstop Solutions. 

The hedge fund industry outperformed the S&P 500 Total Return Index, which was down 3.80 per cent in September.

For the year-to-date, the hedge fund industry remained in positive territory, up 1.70 per cent through September. The S&P 500 Total Return Index was up 5.57 per cent over the same period.

By sector, September’s picture was mixed; some posting gains and other sectors giving up ground.

“Equity markets had a difficult time in September as several factors combined to shake investor confidence,” says Sol Waksman, president of BarclayHedge. “Stalled stimulus talks in Washington, fears that increasing Covid-19 case counts might prompt new lockdowns and concerns over the possibility of a contested US presidential election were a drag on global equity markets.”

Among September’s gainers, the Volatility Trading Index led the way with a 1.55 per cent return. The Merger Arbitrage Index was up 1.24 per cent, the Convertible Arbitrage Index rose 0.85 per cent, the Healthcare & Biotechnology Index gained 0.84 per cent, the Event Driven Index returned 0.55 per cent and the Pacific Rim Equities Index was up 0.37 per cent.

Sectors in the red in September included the Emerging Markets Latin American Equities Index, off 3.41 per cent, the Balanced (Stocks & Bonds) Index, down 2.08 per cent, the Equity Long Bias Index, losing 1.72 per cent, the Emerging Markets Eastern Europe Index, retreating 1.58 per cent, the Technology Index dropping 1.26 per cent and the Global Macro Index, falling 1.03 per cent.

For the year-to-date, the results among various indices were similarly mixed, though gainers were in the majority. Leading the way was the Technology Index, up 14.92 per cent, followed by the Volatility Trading Index, gaining 13.93 per cent, the Emerging Markets Asian Equities Index, advancing 10.20 per cent, the Healthcare & Biotechnology Index, rising 9.17 per cent, and the Fixed Income Arbitrage Index, advancing 8.34 per cent.

Among sectors losing ground in 2020, the Emerging Markets Latin American Equities Index was down 16.78 per cent year-to-date, the Emerging Markets Eastern European Equities Index was off 7.03 per cent, the Emerging Markets MENA Index lost 6.45 per cent, the Emerging Markets Global Equities Index was down 5.19 per cent and the Pacific Rim Equities Index was off 3.89 per cent.