Early reporting funds suggest a strong month for hedge funds across the board this September, as the Eurekahedge Hedge Fund Index advanced at 3.6%.
In the underlying markets, the Fed’s interest rate cut of 50 bps on 18 Sept. triggered a sharp recovery in markets across the globe, with most asset classes faring impressively during the month.
Commodities such as oil and precious metals, among others, did well during the month, benefiting CTA managers (+5.1%), who also made healthy gains from currency-linked trades (as the USD depreciated significantly against most major currencies). Macro and long/short managers also posted strong gains of 5% and 4.1% respectively; the former made some gains from trends in the currency and interest-rate markets, while the latter largely benefited from healthy performance of global equities (the S&P 500 and the MSCI World Index gained 3.6% and 4.6%, respectively).
The emerging markets (+5.3%) and Asia (+4.7%) did just as well; healthy gains were recorded in Eastern Europe & Russia (+4.1%) and Asia ex Japan (+6.6%), as regional markets rallied strong, with some posting double-digit gains.
Overall, the industry generated a positive return for investors of 0.85% net of fees for the month to September 26, according to the investable hedge fund index published by US data provider Hedge Fund Research and reported by the Financial Times.