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S&P Hedge Fund Index up 1.23% in December
The S&P Directional/Tactical Index rose 1.45% in
December, with the equity long/short strategy leading the
way, according to a press release from the company.
“After underperforming much of the year, a strong
fourth quarter rally in US markets has salvaged what
appeared to be a weak year for equities,” said Charles
Davidson, Senior Hedge Fund Specialist at Standard &
Poor’s, in the release. “Through strong stock
selection and increased market exposure, hedge fund
managers were able to capture much of the positive
revaluations in companies.”
Managed futures did not do so well in December, with the
European up but earnings mitigated by losses in the
precious metals and energy sectors.
The S&P Arbitrage Index ended the month up 0.91%,
with relatively strong gains in fixed income arbitrage –
particularly mortgage traders – were partially offset by
underperformance in both equity market neutral and
convertible arbitrage. S&P attributed the latter
two’s mediocre returns to low equity volatility on the
month.
The S&P Event-Driven Index returned 1.33% for the month
as all three of the supporting sectors landed in positive
territory, according to the news release. Distressed and
special situations both saw gains after there was a
positive reevaluation of a number of companies in the
energy and technology sectors. Improving balance sheets
caused upward earnings revisions also contributed to the
gains seen in this area.
Merger arbitrage profits, despite the announcement of a number of large transactions on the month, remained stagnant.
Year-to-date, the S&P Hedge Fund Index was up
3.88%, with 3.43% of that coming in the last quarter.
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