Hedge Fund Losses
Hedge Funds Falter in May Amid Rocky Markets
Unstable markets caused most hedge funds to suffer losses last month, according to early data. The HFRX Global Hedge Fund Index which tracks 250 hedge funds fell by 1.83% in May 2011. Most of the hedge funds' losses stemmed from commodity and stocks holdings.
Most hedge funds lost money in May's volatile markets, with stock- and commodity-focused funds bearing some of the biggest losses.
The HFRX Global Hedge Fund Index tracking about 250 funds fell 1.83% in the month as of May 27, wiping out earlier returns this year for a 0.97% year-to-date loss.
Its equity hedge sub-index, tracking funds that take long and short bets on stocks, was down 3.4%, while systematic macro funds that rely on computers to buy and sell stocks, currencies, commodities and interest-rate instruments lost 2.13% in the period.
The losses came in the worst month for stocks since August. The MSCI World Index of equities lost 2.45% and the S&P 500 declined 1.4%. Commodities took an even bigger hit as worries grew over the strength of the global economic recovery, with silver off by 21% and oil slipping 10% in the month. Source
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