Hedge funds outpaced indexes in first half of year

The hedge fund industry experienced gains in the first half of the year, according to data released today by Hennessee Group LLC of New York. The firm's Hennessee Hedge Fund Index posted a gain of 0.64% for the month of June, and 11.74% for the year to date through June 30, the report said. To date, the index has outpaced the Standard & Poor's 500 stock index, which gained 0.02% in June and had a year-to-date return of 1.78%, as well as the Dow Jones Industrial Average, which declined 0.63% in June and has posted a 3.75% decline year to date. The Nasdaq Composite Index gained 3.10% in June with a year-to-date return of 16.36%. Bonds have also risen, with the Barclays Aggregate Bond Index posting a gain of 0.57% for the month, and a 1.90% increase year-to-date, the report found. Still, the industry should not be complacent about the gains, according to Charles Gradante, co-founder of the Hennessee Group. “I think we have reached an inflection point, as momentum seems to have faded,” he said. “We should see a return to stock picking based on fundamentals, which are rather negative. In addition, the technicals are also bad, leading us to believe in a summer correction,” he said in a statement.