The Hennessee Hedge Fund Index declined 0.55 per cent in August, taking its year-to-date performance to +1.32 per cent.

The S&P 500 decreased 4.74 per cent in August (-5.90 per cent YTD), the Dow Jones Industrial Average fell 4.31 per cent (-3.96 per cent YTD), and the Nasdaq Composite Index declined 6.24 per cent (-6.84 per cent YTD). 

Bonds advanced, as the Barclays Aggregate Bond Index increased 1.29 per cent (+7.83 per cent YTD).

“Hedge funds started the month with reduced net and gross exposure levels, which allowed them to protect capital while generating ‘alpha’ in August, as the equity markets declined. Managers remain cautious given the global economic uncertainty, though the consensus is that we will likely avoid a ‘double-dip’ recession,” says Charles Gradante, co-founder of Hennessee Group. “It was also encouraging to see that 43 per cent of hedge funds reporting were able to generate positive performance in August as markets started to respond more to fundamentals.”