Wednesday, 08 September 2010 22:00
Hedge funds lost money in August, with the average fund down 0.55% for the month, according to data from the Hennessee Group. This comes after an average 1.9% gain for hedge funds in the month of July. Broader markets struggled as well, with the S&P 500 down some 4.7% in the worst August since 2001, when the S&P 500 lost 6.4% as the dot-com bubble burst.
Poor recent economic data has left investors with fresh worries about the pace of the U.S. economic recovery. Hedge funds like John Paulson’s that made bets on a strong rebound in the markets have underperformed this year. Paulson’s Advantage Plus fund was down 4.3% in August and is down 11% YTD.
Macro funds and short biased funds were among the best peforming strategies in August, according to Hennessee’s data, turning in average gains of 2.2% and 3.6%, respectively.