Morningstar: Hedge funds score small gains

Hedge funds posted small gains last month following the rally in the equity market, according to a Morningstar report released today.
APR 21, 2009
Hedge funds posted small gains last month following the rally in the equity market, according to a Morningstar report released today. The firm’s Morningstar 1000 Hedge Fund Index rose 2.1% in March, and the currency-hedged Morningstar MSCI Asset-Weighted Hedge Fund Composite Index increased 0.1%. Both indexes ended the quarter nearly flat, with the hedge fund index dropping 0.1% and the asset-weighted index increasing 0.5%. The March rally in equities was worldwide, and positive manufacturing news in China, and higher commodities prices boosted stocks in emerging markets. As a result, the Morningstar MSCI Emerging Markets Index increased 4.2%, and Morningstar Emerging Markets Hedge Fund Index increased 6.2%, the firm reported. Still, many hedge fund managers do not believe that the economy has turned around, according to Nadia Papagiannis, a Morningstar hedge fund analyst in the report. “Hedge fund managers continued to remain cautious and were not strongly positioned to participate in the market rally,” she said. Morningstar Inc. of Chicago tracks about 8,000 hedge funds and funds of hedge funds.

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