Hedge Funds November Performance

Hedge Funds Fell 1% in November, Beat Stocks

The average hedge fund declined about 1% last month, according to recent data from Bloomberg's hedge fund index. That's still better than most stocks performed last month as Europe's debt crisis sunk global stocks in November, but worse than October's average 2.2% gain by hedge funds.

The Bloomberg aggregate hedge-fund index dropped to 116.03 from 117.22 in October, bringing this year’s loss to 3.8 percent. Long-short equity funds, multistrategy funds and macro funds, which bet on global economic trends, declined.

“Volatility has been fierce,” said Andrew Parrillo, president and founder of Newport Capital Advisers Inc. in North Quincy, Massachusetts, which has about $200 million in assets to invest. “Hedge funds are getting a bit of a whipsaw. They really are concerned about the resolution of this impasse in Europe.”

Europe’s crisis has added to woes for hedge-fund managers struggling with market volatility and increased correlation among asset classes. John Paulson, who oversees $28 billion, lost 46 percent this year through November in one of his largest funds in part because of wrong-way bets on an economic recovery. Paulson is the industry’s sixth-biggest manager, according to data compiled by Bloomberg.

The MSCI All-Country World Index of global stocks declined 3.2 percent in November amid concern that a Greek referendum would threaten Europe’s bailout, along with record costs to insure European government debt. Source

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