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Canadian hedge funds rise by 1.02 per cent in April

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The Scotia Capital Canadian Hedge Fund Performance Index finished April 2010 up 1.02 per cent on an asset weighted basis and up 0.68 per cent on an equal weighted basis.

The index performed in line with North American equities and broader hedge fund indices on an asset weighted basis.

Global capital markets posted mixed results in April. The Greek debt crisis continued to dominate headlines, and European equity markets sold off significantly as market volatility surged and investors expressed concern over potential contagion into other Eurozone countries.

North American equities also experienced a mid-month sell off, following on from the Securities and Exchange Commission’s charges against Goldman Sachs. The S&P500 closed April up 1.48 per cent.

Sector performance was mixed, ranging from strong gains in consumer discretionary to sharp declines in healthcare. In Canada, the Toronto Stock Exchange advanced 1.44 per cent.

Canadian materials, energy and telecom stocks were the top contributors with sharp declines in consumer staples, utilities and IT.

Commodities rallied in April, with gold rising sharply by 5.92 per cent and oil gaining 2.85 per cent.

In foreign exchange, the Canadian dollar reached parity with the US dollar briefly on 6 April, in investor anticipation of a Bank of Canada rate hike later in the month that did not take place. The USD finished April with slight gains versus the CAD and JPY, and significant gains versus the EUR, while declining versus the GBP.

In line with global peers, Canadian hedge fund managers made modest aggregate gains in April, and continue to maintain a cautious stance in light of uncertainty over the direction of capital markets.

The aim of the Scotia Capital Canadian Hedge Fund Performance Index is to provide an overview of the Canadian hedge fund universe. Index returns are calculated using both an equal weighting and an asset-based weighting of the funds. The index includes both open and closed funds with a minimum AUM of CAD15m and at least a 12 month track record of returns, managed by Canadian-domiciled hedge fund managers.

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