Tough Month for Hedge Funds in November

Hedge Funds slid 0.28% in November according to the Barclay Hedge Fund Index compiled by BarclayHedge, which is now owned by Backstop Solutions, versus a 2.04% increase in the S&P 500 Total Return Index. Year to date, the Barclay Hedge Fund Index is down 2.42%, while the S&P has gained 5.11%.

“Global equity markets had mixed returns in November as European markets fell while the US and Asia rose,” says Sol Waksman, founder and president of BarclayHedge. “An 18.4 percent drop in the price of Apple along with declines in Facebook and Netflix – stocks that are widely held by hedge funds – created additional losses for technology funds.”

Overall, 14 of Barclay’s 17 hedge fund indices had losses in November, while three had gains. 

Distressed Securities lost 2.04% in November, Equity Market Neutral gave up 1.63%, the Global Macro Index dropped 1.60%, Multi-Strategy was down 1.17%, and the Healthcare & Biotechnology Index lost 1.14%.

On the positive side, Emerging Markets gained 1.84%, the Merger Arbitrage Index was up 1.41%, and the Event Driven Index gained 0.72%.

“A decline in US interest rates coupled with a weakening of the US dollar was a net positive for emerging markets whose debt is dollar denominated,” says Waksman.

At the end of November, 10 hedge fund indices now have negative returns for the year, while seven still have gains. 

Emerging Markets have lost 9.33%, Pacific Rim Equities are down 7.44%, the Global Macro Index has lost 4.48%, the Multi Strategy Index has given up 3.54%, and Equity Long Bias is down 3.20%.

Year to date, the Healthcare & Biotechnology Index has a 9.87% gain, Technology is up 6.63%, Distressed Securities have gained 4.34%, and Fixed Income Arbitrage is up 1.77%.

The Barclay Fund of Funds Index gave up 0.65% in November, and has a 3.02% loss for the year. 

 

Colin Lambert

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