After the worst start to a year since 2008, hedge funds repaired some of the damage in March as investments in equities, fixed income and commodities fueled the best monthly gains in two years.
The $1.3bn CQS Diversified Fund, down more than 4% through February, gained 5.2%, according to an investor letter seen by Bloomberg, while the Lyxor Odyssey Value Fund which manages less than $10m was up 9% after losing 13% in the first two months. A spokesman for CQS declined to comment.
The near $3 trillion hedge-fund industry has faced criticism for poor performance this year with some of the best known firms still to recover losses.
“The solid performance of hedge funds in March was related to the gains generated by long-short equity and event driven strategies as markets rallied," said Philippe Ferreira, a strategist at Lyxor Asset Management. "To a lower extent, long-short credit also fueled overall hedge-fund performance."
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