The Lyxor Hedge Fund Index was up 0.14 per cent in August, with seven out of 10 Lyxor indices ending the month in positive territory.

The summer lull supported hedge funds, with merger arbitrage and fixed income and credit managers leading the pack.
 
In contrast, long-term CTAs suffered a setback especially due to the volatility in USD and US bonds.
 
“Most investors struggle to find compelling investment opportunities,” says Jean-Baptiste Berthon, senior cross-asset strategist, Lyxor Asset Management. “Trading volumes are low, the smart money remains on the sideline, trends don’t last, and differentiation across assets declined. However, with volatility flirting with lows, markets are vulnerable to the load of catalysts due in September: three major monetary meetings, a heavy political agenda in Italy, Spain and Portugal, the first US presidential debate. Funds focusing on fixed income, Japan or Europe might have more opportunities in September.”