Many Hedge Funds Have Weak Start In January, Lagging Stocks
02 Fevereiro 2011 - 8:54AM
Dow Jones News
Many hedge funds lagged stock market indexes and took the wrong
side of currency and interest-rate bets in January, in a lackluster
start to the year for the industry.
The HFRX Global Hedge Fund Index, tracking about 250 funds that
report on a daily basis, gained 0.56% in January, far less than the
S&P 500's 2.4%. Treasury yields were little changed in the
month as a mixed outlook for the U.S. economy led investors to
reset their expectations on when interest rates might rise.
By strategy, HFRX constituent hedge funds investing in
distressed debt had the best month, up 1.87%, while systematic
hedge funds that use automated computer models to make trades
across asset classes were down 2.58%.
One systematic trading fund that has already reported for the
month, Man Group PLC's (EMG.LN) AHL Diversified, lost 3.5%. Last
year it outperformed the broader hedge-fund industry with a 16%
gain. The HFRX Global Hedge Fund Index was up 5.19% in 2011. A more
widely watched index, the HFRI Fund Weighted Composite Index posted
a 10.5% gain. Both indexes are compiled by Hedge Fund Research Inc.
The HFRI index data for January will be released within about a
week, after its roughly 2,200 constituent funds submit their
data.
Another early reporter that makes public its performance, Third
Point Offshore Fund, continued its 2010 winning streak with a 3.9%
rise in January. The $2.77 billion fund makes investments linked to
company mergers, debt restructurings and other corporate events and
was up 34% last year.
Third Point in an investor update Wednesday said its top winners
in the month included positions in fertilizer company Potash Corp.
(POT) and paper-packager Smurfit-Stone Container Corp. (SSCC).
Potash Corp.'s stock rose 15% in the month, after record sales
of potash in the fourth quarter. Smurfit-Stone shares soared nearly
50%, as the company announced an agreement to be acquired by
Rock-Tenn Co. (RKT).
Losing positions included gold--one of Third Point's largest
portfolio holdings--off about 6.3% in January, and German chemicals
company Brenntag AG, whose stock slumped more than 9% in the
month.
Meanwhile, Boussard & Gavaudan Holding Ltd. (BGHL.AE), a
listed vehicle of Anglo-French hedge fund manager Boussard &
Gavaudan Asset Management LP, Tuesday reported a 0.64% increase in
January. The listed company invests in B&G's Sark fund, trading
in stocks, credit instruments and volatility.
The hedge-fund industry for the most part has gotten back on its
feet since the financial crisis wiped out hundreds of billions of
dollars from its asset base. HFR last month said industry assets
reached $1.92 trillion at the end of December, just short of their
$1.93 trillion peak in mid-2008.
-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451;
margot.patrick@dowjones.com
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