All of the six hedge fund strategies covered by Dow Jones Hedge Fund Indexes posted net-of-fees gains in April 2007.
With net-of-fees returns of 2.74% and 2.34%, respectively, the equity long/short and event driven strategies had the best performance in April. Distressed securities and merger arbitrage followed with returns of 1.37% and 1.04%. Equity market neutral and convertible arbitrage had gains of 0.43% and 0.23% for the month.
Year to date, four of the six strategies have posted net-of-fees returns greater than 5% with merger arbitrage leading with a cumulative gain of 7.53%. Equity long/short is in second place with a YTD return of 6.92%. Distressed securities and event driven are tied for third place with YTD returns of 5.67% and 5.68% – a difference of 1 basis point. The remaining two strategies, convertible arbitrage and equity market neutral, are up 2.13% and 1.69% for the year.
On a float-adjusted basis, the Dow Jones Wilshire 5000, the only broad measure of the domestic equity market, returned 4.00% (3.86% on a full-cap basis) in April, making a significant contribution to its YTD gain of 5.46% (5.40% on a full-cap basis).
The fixed income asset class, as measured by the Dow Jones Corporate Bond Index, gained 0.95% this month for a cumulative gain of 2.59% for the year.
Finally, the Dow Jones Wilshire Global Index, the broadest measure of global equity markets, was up 4.37% for the month increasing its YTD gains to 7.44% for 2007.