Hedge funds lost 2.83 per cent in January according to the Barclay Hedge Fund Index compiled by BarclayHedge – the worst start to a new year in eight years since the Index dropped 3.26 per cent in January 2008.
“Slowing fourth quarter growth in the US, heightening concerns about the Chinese economy, and a precipitous decline in energy prices all weighed heavily on investor sentiment," says Sol Waksman (pictured), founder and president of BarclayHedge.
Overall, 15 of Barclay’s 18 hedge fund indices had losses in January. The Healthcare and Biotechnology Index was hit the hardest, dropping 7.10 per cent in one month.
“In spite of reported earnings growth in the healthcare sector, the NASDAQ Biotech Index fell 21 percent,” says Waksman.
The Emerging Markets Index lost 4.87 per cent in January, Equity Long Bias was down 4.84 per cent, Technology gave up 3.82 per cent, European Equities lost 3.48 per cent, Distressed Securities were down 2.83 per cent, and the Event Driven Index lost 2.67 per cent.
On the positive side, the Equity Short Bias Index jumped 3.21 per cent in January, Merger Arbitrage was up 0.51 per cent, and Equity Market Neutral added 0.18 per cent.
The Barclay Fund of Funds Index was down 2.59 per cent in January.