Key Takeaways
- • Hedge funds posted a 0.88% gain in October 2019, according to the Barclay Hedge Fund Index compiled by BarclayHedge, a division of Backstop Solutions, trailing the S&P Total Return Index's 2.17% advance for the month.
- • Year-to-date through October, hedge funds returned 7.95%, versus 23.17% for the S&P Total Return Index.
- • October saw positive returns across 28 of Barclay's 31 hedge fund indices, led by the Healthcare & Biotechnology Index at 5.88%.
- • Global Macro (-0.33%), Multi Strategy (-0.15%), and Emerging Markets MENA (-0.49%) were the only sectors in the red for October.
- • Volatility Trading (-1.47%) and Equity Market Neutral (-0.24%) were the only sectors negative year-to-date through October.
Summary
Hedge funds posted a monthly gain of 0.88% in October 2019, according to the Barclay Hedge Fund Index compiled by BarclayHedge, a division of Backstop Solutions. The industry's return lagged the S&P Total Return Index, which rose 2.17% over the same month. Year-to-date through October, hedge funds returned 7.95%, while the S&P Total Return Index gained 23.17%.
Breadth of gains was broad: 28 of Barclay's 31 hedge fund indices recorded positive returns in October. The Healthcare & Biotechnology Index led with a 5.88% return, followed by the Technology Index (2.46%), the Option Strategies Index (2.41%), the Emerging Markets Global Equities Index (2.17%), and the Emerging Markets Latin American Equities Index (2.13%). Only three sectors declined: the Emerging Markets MENA Index (-0.49%), the Global Macro Index (-0.33%), and the Multi Strategy Index (-0.15%).
Sol Waksman, president of BarclayHedge, attributed the month's gains to hopeful economic signals. He said that although business investment and manufacturing had slowed, consumer spending, supported by full employment, had continued to rise. He also cited anticipation of a third rate cut by the US Federal Reserve this year and a return to a normalized yield curve as factors that helped push the S&P 500 to new highs in October.
Year-to-date, leading sectors included the Emerging Markets Eastern European Equities Index (16.14%), the Technology Index (14.58%), the Healthcare & Biotechnology Index (14.23%), and the Emerging Markets Latin American Equities Index (13.35%). The Volatility Trading Index (-1.47%) and the Equity Market Neutral Index (-0.24%) were the only sectors in negative territory for the year through October.
Breadth of gains was broad: 28 of Barclay's 31 hedge fund indices recorded positive returns in October. The Healthcare & Biotechnology Index led with a 5.88% return, followed by the Technology Index (2.46%), the Option Strategies Index (2.41%), the Emerging Markets Global Equities Index (2.17%), and the Emerging Markets Latin American Equities Index (2.13%). Only three sectors declined: the Emerging Markets MENA Index (-0.49%), the Global Macro Index (-0.33%), and the Multi Strategy Index (-0.15%).
Sol Waksman, president of BarclayHedge, attributed the month's gains to hopeful economic signals. He said that although business investment and manufacturing had slowed, consumer spending, supported by full employment, had continued to rise. He also cited anticipation of a third rate cut by the US Federal Reserve this year and a return to a normalized yield curve as factors that helped push the S&P 500 to new highs in October.
Year-to-date, leading sectors included the Emerging Markets Eastern European Equities Index (16.14%), the Technology Index (14.58%), the Healthcare & Biotechnology Index (14.23%), and the Emerging Markets Latin American Equities Index (13.35%). The Volatility Trading Index (-1.47%) and the Equity Market Neutral Index (-0.24%) were the only sectors in negative territory for the year through October.
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