Hedge Funds Performance

Equity funds trail March-April rally


Gun-shy hedge funds, fearing volatility and bracing for further redemptions, were heavily hedged and in cash going into the March-April market rally and, as a result, missed most of the upside. The Absolute Return U.S. Equity and Global Equity Indices trailed the two-month 18.73% rise of the S&P 500 Index by double digits, rising 4.08% and 4.98%, respectively, over the same period.

An analysis of hedge fund returns for those strategies going back to 1998 reveals that the hedge funds have trailed each of the S&P 500's five biggest two-month rallies. During the second-largest two-month rally in the