By Kelly Bit - Nov 5, 2011 2:21 AM GMT+0800
Article from the Bloomberg
Hedge funds gained 1.4 percent in October, the most since April, as global stocks rallied because of higher-than-estimated earnings and optimism that European lenders would take steps to contain the region’s debt crisis.
The Bloomberg aggregate hedge-fund index increased to 117.14 from 115.52 in September, trimming this year’s decline to 2.9 percent. Long-short equity funds, multistrategy funds and macro funds, which bet on global economic trends, gained.
“There was a broad rally in the market, which led to positive performance,” said Emma Sugarman, global head of capital introduction at BNP Paribas SA in New York, which helps hedge funds meet clients. “De-risking in September and raising cash levels meant a lot of people didn’t participate as fully in the rally as they might have.”
The MSCI All-Country World Index of global stocks jumped 10 percent in October after Germany and France pledged to support European banks and increase the size of the rescue fund. Per- share earnings beat estimates at about three-quarters of the companies in the Standard & Poor’s 500 Index that released results since Oct. 11, according to data compiled by Bloomberg.
Multistrategy hedge funds rose 0.1 percent in October and declined 1.2 percent in 2011. Macro funds advanced 1.7 percent last month and slumped 2.3 percent this year. Long-short equity funds, whose managers can bet on rising and falling stocks, gained 3.6 percent in October and dropped 2.3 percent this year.
Hedge funds fell 4.2 percent in September, based on Bloomberg’s aggregate index, as global stocks plunged. Funds gained 2.5 percent in April, their best month of this year.
The main Bloomberg hedge-fund index is weighted by market capitalization and tracks 2,889 funds, 1,348 of which have reported returns for October. The index is down 10 percent from its July 2007 peak.
Hedge funds, investment pools that can wager on or against any asset, hold $1.97 trillion, according to Hedge Fund Research Inc. in Chicago.
To contact the reporter on this story: Kelly Bit in New York at kbit@bloomberg.net
To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net
Article from the Bloomberg
