The Barclay Hedge Fund Index rose 0.90% in June, as hedge funds notched their 12th straight month of gains. According to Barclay data, hedge funds have advanced 14.4% since July of 2006.
"As an asset class, hedge funds continue to be a profitable alternative for investors," says Sol Waksman, founder and president of The Barclay Group. "The Barclay Hedge Fund Index has gained 71.50% over the past five years, with compound annual return of 11.39% per year."
Over the past 60 months, the index has fallen in 10 months and risen in 50.
In June, 15 out of 18 Barclay's hedge fund indexes were in positive territory. The Equity Short Bias Index gained 2.50%, Emerging Markets rose 2.25%, Pacific Rim Equities gained 1.62%, and Global Macro was up 1.59%.
"Equity markets in the U.S. and many other developed economies experienced price declines during the month, however hedge funds devoted to equity strategies were still able to make a profit in June," says Waksman.
The Barclay Emerging Markets Index has gained 12.90% in the first six months of 2006, followed by Equity Long Bias at 9.96%, Merger Arbitrage at 9.36%, Distressed Securities at 8.57%, and European Equities at 8.38%.
"Continuing problems in the sub-prime loan market have resulted in the closures of several funds specializing in the sector. But spill-over effects into the larger hedge fund sectors have been very limited," says Waksman.
The only sector with a significant drop in June was the Event Driven Index, down 0.77%. "Losses in the Event Driven sector are most likely a result of price declines in equities coupled with declines in bond prices," explains Waksman.
The Barclay Hedge Fund Index has risen 7.55% during the first two quarters of 2007.