Hedge fund returns were slightly negative in June as world markets continued to slide for the second straight month. The Eurekahedge Hedge Funds Index was down 0.59%1 in the month that saw high volatility in all asset classes. However, the trend of outperforming the underlying markets persisted as the MSCI World Index declined 3.56% during the month.
June also witnessed marginally positive net flows of US$0.4 billion in addition to performance-based gains of US$0.2 billion. However, following the heavy losses in May, the total size of the industry is now back down to US$1.51 billion as at end-June.
The year-to-date performance figure for hedge funds slipped into negative territory in June, with the Eurekahedge Hedge Fund Index down 0.12% YTD. However, this still represents an outperformance to the global markets which are down 10.88% June YTD (MSCI World Index).
Figure 1 shows the monthly asset flows across the hedge fund industry since December 2008.
Below are the highlights for the month of June:
- Hedge funds remained flat June year-to-date (-0.12%) while outperforming global markets by more than 10.5%.
- Strong launch activity was seen in 1H2010 – more than 500 launches globally.
- UCITS III hedge fund assets crossed US$100 billion during 1H2010.
- SRI funds outperformed global markets in the last 12 months (1.33%) as well as 2010 YTD (4.21%).
In terms of regional mandates, European managers attracted the most capital…
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1Based on 71.84% of the funds reporting the NAV for June 2010 as at 19 July 2010.