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FAIRFIELD, Iowa, September 14, 2010– Hedge funds slid 0.29% in August according to the Barclay Hedge Fund Index compiled by BarclayHedge.
“Global equity markets beat a retreat in August as the ‘fear trade’ returned with a vigor after having been smothered by increased risk appetite in July,” says Sol Waksman, founder and president of BarclayHedge.
“The fear trade is a product of investor nervousness and typically gives rise to selling of equities and purchases of US Treasury bonds.”
The Barclay Equity Long Bias Index lost 2.03% in August, Equity Long/Short was down 0.76%, while the Equity Market Neutral Index nearly held its ground with a 0.10% loss.
Globally, the Pacific Rim Equities Index lost 1.29%, European Equities were down 0.50%, and Emerging Markets slid 0.08%.
On the positive side, the Barclay Equity Short Bias Index rebounded from a 3.21% loss in July with a 2.49% August gain.
Arbitrage strategies also performed well this month. Convertible Arbitrage was up 1.70%, Merger Arbitrage gained 1.22%, and the Fixed Income Arbitrage Index rose 1.11%.
“The fear trade helped to drive up bond prices in August, and interest-rate sensitive strategies were positively impacted,” says Waksman.
“Merger Arbitrage did well as HP launched a bidding war for 3Par, Intel purchased McAfee, and BHP pursued a hostile bid for PotashCorp.”
The Barclay Fund of Funds Index lost 0.02% in August, and is down 0.81% for the year.
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Sol Waksman is an experienced media source, providing perspectives on hedge fund and managed futures trends. For more commentary or background, call 641-472-3456 or email swaksman@barclayhedge.com.
BarclayHedge was founded in 1985 and actively tracks more than 5,800 hedge funds, funds of hedge funds, and managed futures programs. Each month Barclay provides updated performance rankings for 38 Hedge Fund categories and 16 CTA categories.
Institutional investors, brokerage firms and private banks worldwide utilize BarclayHedge indices as performance benchmarks for the hedge fund and managed futures industries.
