Based on 40.80% of the funds reporting their December 2009 returns as at 12 January 2009.
Hedge funds finished 2009 on a high note with healthy returns of 0.91% through December. The composite Eurekahedge Hedge Fund Index returned 19.16%1 for the year – the best performance on record since 2003 when the index gained 21%. The positive performance for the month was delivered amid increased risk appetite, which pushed global equity markets higher during the month. The MSCI World Index gained 1.69% during the month.
2009 performance of 19.16% is the best on record since 2003. Asia ex-Japan funds posted gains of 37.98% for 2009 which is the best yearly performance for all regions on record.
December is the 8th consecutive month of positive net inflows to the industry, bringing the total assets from US$1.29 trillion to US$1.48 trillion over this period.
2009 saw most strategic indices post their strongest yearly gains on record – event driven funds achieved the highest annual returns on record across all strategic mandates by posting 38.02%.
Based on the initial data received so far for December, the hedge fund industry grew by US$2 billion through December; the sector is expected to attract greater allocations through 1Q2010.
December was a favourable month for the global hedge fund sector, spreading the holiday cheer across the board as all regional mandates posted healthy returns. Asia ex-Japan managers outperformed their counterparts in other regions while also standing out annually. The Eurekahedge Asia ex-Japan Hedge Fund Index gained 2.16% in December, closing the year at 37.98% - the best annual performance on record across all regional indices in ten years. North American and European managers also posted the best yearly results of their respective indices as managers across the globe capitalised on the sustained rallies seen across most asset classes throughout the year.
The biggest gainers for December, Asia ex-Japan managers, were buoyed by strong growth figures from China which helped to drive positive market sentiments. North American managers also posted strong returns through December, gaining 1.81% on average through bets in the high-yield space and the equity markets – the S&P500 was up 1.9%. Japanese hedge funds also saw their first positive month since August as the Nikkei gained 12.8%.
Eurekahedge Eastern Europe & Russia Hedge Fund Index
0.89
59.96
-54.54
Eurekahedge Japan Hedge Fund Index
1.76
6.80
-10.22
Eurekahedge Emerging Markets Hedge Fund Index
1.76
34.42
-23.17
Eurekahedge Asia ex-Japan Hedge Fund Index
2.12
26.16
-26.85
Eurekahedge Latin American Hedge Fund Index
1.27
26.32
-4.21
Strategy Indices
Managers of most strategic mandates returned positive for the month with distressed debt and relative value hedge funds posting the strongest performances of 3.24% and 3.02%, respectively, as managers profited from a spike in risk appetite and widening US Treasury yield curve. Event driven and long/short equity managers also delivered healthy returns of 2.55% and 2.16%, respectively, amid rallying equity markets.
On the yearly measure, all strategies have been positive through 2009 and in most cases, the strategic indices have delivered record returns. Initial data shows that distressed debt hedge funds gained 37.15% on average while event driven hedge funds are up 38.02% for the year – both these returns beat the previous best yearly returns across all strategies seen in 2003 when distressed debt managers gained 33.60%.
Eurekahedge indices are available for download from www.eurekahedge.com/indices/hedgefundindices.asp and are updated with the latest fund returns at 23:30 GMT every day. Index values and data can be downloaded for free and subscribers can download the full list of index constituents. Please contact indices@eurekahedge.com for more information.
