Hedge fund index reports perfect 2017 for returns

Hedge funds have made positive returns for every month in 2017 for the first time since 2003, according to hedge fund data provider HFR.

HFR based the claim in the LFRI Fund Weighted Composite Index, which rose by 8.5% over 2017. In December, the index was up by 0.9%, ahead of most equity market indices, including the Nasdaq, Russell 2000, Nikkei 225, Shanghai composite and France’s CAC 40.

In terms of styles and strategies, event-driven and equity hedge funds led hedge fund performance, helped by an improving mergers and acquisitions environment, as well as expectations for comprehensive US tax reform. Kenneth J. Heinz, President of HFR, commented: “The powerful combination of surging global equity markets, dynamic M&A trends, commodity volatility and divergent interest rate cycles has created an exciting opportunity set for hedge funds coming into 2018. Developing opportunities in risk parity, blockchain and cryptocurrency trading, each of which have posted outstanding performance in 2017, are likely to further complement and contribute to record industry growth in 2018.”