Despite concerns over losses in the sub-prime mortgage industry, hedge funds gained 0.62 percent in July, according to flash estimates from the Barclay Hedge Fund Index.
“There have been some well-publicised losses among a few high-profile funds that invest in sub-prime mortgages,” says Sol Waksman, founder and president of The Barclay Group. “Those losses highlighted weaknesses in the fixed income sector and sparked a wave of selling in equity markets that sent stock prices into the loss column for July.”
Eleven of Barclay’s 18 hedge fund indexes gained ground in July. The Equity Short Bias Index jumped 6.56 percent, Emerging Markets rose 3.19 percent, Pacific Rim Equities gained 1.67 percent and Technology was up 1.66 percent.
“Although we’re seeing more hedge fund losses this month, the bottom line is that the overall hedge fund index and fund of funds index are positive once again. Except for the handful of funds that blew up, the sky is not falling,” says Waksman.