Hedge funds finish in positive territory
Hedge funds finished the month of June in positive territory at 0.43 per cent, according to the Credit Suisse/Tremont Hedge Fund index, despite earlier indications that the sector would finish in negative territory.
Convertible arbitrage was the best performing strategy in the index, recording 4.05 per cent in June. Managers benefited from the volatility arbitrage features of the strategy as equity markets began to recover.
Credit-oriented hedge funds also performed well, with $102 billion in investment grade bonds poured into the market.
Long/short equity managers who have maintained a cautious stance should be in a position to profit as the market shifted from cyclical to defensive shares in June.
However, emerging markets hedge funds finished relatively flat despite rebounding economic activity in Asia, and the sell-off of short rates in the US Treasury pushed global macro strategies into their first negative returns since October last year.
Hedge funds attracted $19 billion of fresh capital, with net inflows reaching a total of $6 billion, according to Eurekahedge. This is the second consecutive month of net inflows into the sector.
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