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August 8, 2006
Long/short equity falls further in July
In a month of mixed returns for the Dow Jones Hedge Fund indexes, long/short managers were again the biggest movers. Unfortunately, that movement was once again downward.
Equity long/short hedge funds tracked by the Dow Jones indexes fell 1.99% in July, cutting managers' year-to-date returns to 0.15% following three successive months of losses. It has been a tough summer to be a long/short equity hedge fund—it declined 1.51% in June Previous HedgeWorld Story and 3.53% in May Previous HedgeWorld Story, more or less erasing the 5.67% gains posted in the first quarter, when equity long/short was the top-performing strategy.
Better news came from the equity market neutral camp, posting the month's strongest growth with a 1.1% increase. Year-to-date the strategy has returned 4.35%, following gains of 1.83% and 1.35% in the first and second quarters, respectively.
Convertible arbitrage managers returned 1.02% in July, bringing their year-to-date total to 6.44%. Merger arbitrage gained 0.62% for the month and is up 5.66% year-to-date. Distressed securities, although returning only 0.59% in July, leads the indexes' year-to-date results with 8% so far in 2006.
Event-driven hedge funds continued a slide that began several months ago, losing 0.14% in July following gains of 1.18% for the second quarter and 4.08% in the first. Year-to-date the strategy has returned 5.22%.
Although results were not stellar, overall the Dow Jones Hedge Fund indexes outperformed their benchmarks. While the Dow Jones Corporate Bond index returned 1.57%, the Dow Jones Wilshire 5000 fell 0.12% on a float-adjusted basis, and the Dow Jones World Total Market index fell 1.68%.
-HedgeWorld.com-
Posted by su at August 8, 2006 2:29 PM