Hedge Funds Gains Driven By Growth in Asia

This May marks the seventh consecutive month that hedge funds have seen positive returns, which are up by 4% year-to-date, according to the June 2013 Eurekahedge Report.

The report finds that well-performing hedge funds include Asia ex-Japan hedge funds, which have grown by 2.04% in May, despite a decline of 4.35% from the MSCI Asia Ex-Japan Index. Most growth comes from Great China, with a growth of approximately 4% in May.

Another high performer is distressed debt funds, which have been gaining for 11 consecutive months and have gained 22.8% since the end of June 2012.

In contrast, CTA/managed futures funds declined by 1.81% in May.

Total AuM increased $3.1 billion to $1.88 trillion, hitting its highest record since mid-2008. While net flows were positive for the fifth consecutive month, impact of performance on total assets was slightly negative as managers lost $1.5 billion over the course of the month.

Overall, May started on a positive note, with encouraging economic signs from the U.S.; however, weak manufacturing from China and uncertainty regarding the Federal Reserve’s asset purchase program led to a turn of the tide mid-month.