US - The Average US Hedge Fund index beat all major indices in July, according to Nashville-based global hedge fund advisory firm, Van Hedge Fund Advisors International (Van).
The Average US Hedge Fund fell -0.6% net in July and the Average Offshore Hedge Fund -1.1% net, but both still outperformed most major indices.
The Dow gained 0.3%, but the S&P 500, Russell 2000 and NASDAQ all dropped -1.0%, -5.3% and -6.2%, respectively.
According to the firm - on an annual basis - both the Average US Hedge Fund and the Average Offshore Hedge Fund are outpacing most major indices with net gains of 2.9% and 2.2%, respectively. Actively managed funds also slid with the Average Equity Mutual Fund falling -2.9% in July.
Through July, the Russell 2000 gained 1.2%, but the Dow, S&P 500, Average Equity Mutual Fund and NASDAQ were all negative, with returns of -1.6%, -7.6%, -9.5% and -17.8%, respectively.
“A string of bad economic news took its toll on the major markets in July,'' said Steven Lonsdorf, Van’s chief executive officer.
“Corporate profit warnings, rising unemployment and slowing economic growth all combined to drive investors out of the markets. While hedge funds were not immune to the sell-offs, they did stem losses and managed to largely protect prior months' profits. In fact, roughly 50% of the funds reporting for the index managed to post gains in July.
For July, the best performing strategies were US short sellers, offshore short sellers and US several strategies, which netted returns of 5.0%, 3.3% and 2.6%, respectively. For the year to date through July, US distressed securities managers posted the best net return of 14.1%. Offshore distressed securities and US value have returned 11.3% and 9.9%, respectively. *Van's information on hedge funds is based on information received from the hedge funds in its databases. Returns are net of fees and performance allocations. The timing of the deduction of such fees and performance allocations may affect the reported performance. The July Index was created using a sample of 684 funds.
By Madhu Kalia
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