The Eurekahedge Hedge Fund Index advanced by 0.9% in December, bringing returns for 2007 to a healthy 13.6%.
The main contributors were CTAs and macro players, who finished the month up 1.8% and 1.2% respectively, making some of their gains from the surge in oil, which rose by 8.6%, and precious metal prices. Gold and silver, for instance, rose in excess of 7%.
Long/short players finished the month up 0.8% benefiting mainly from short positions despite high volatility across equities; the MSCI World Index finished the month down 1.3%.
In terms of regional mandates, emerging market-focused managers returned a healthy 1.6%, benefiting partly from equities in Russia , which was up 3.9%, and Emerging Asia. The Shanghai Composite Index ended the month up 8%, while Indian stocks rose by 4.7%.
North American managers were up 0.7% despite persisting fears of a US economic slowdown and the attendant investor risk aversion; this was partly owing to the outstanding performance of CTAs in the region, which returned 3.2%.
European managers finished the month relatively flat, on -0.3%, while Japanese managers finished the month down 1.2%, on the back of poor earnings in the financial sector, among other things.