Emerging market hedge funds post highest returns

Emerging market hedge funds continued to generate lucrative returns in June, averaging a 3.3% gain net of fees, according to the Van Global Hedge Fund Index.

The emerging markets continued to perform better than any of the other 13 strategies in Van's global index. The emerging markets index also leads for the year-to-date, at 15.1%.

Overall, the Van Global Hedge Fund Index posted a 1.2% net gain in the same month, which was the fourth month of consecutive positive growth by the hedge funds in the Van database.

The Van Global Index, which is one of the most widely followed benchmarks, rose 8% net of fees for the first half of 2003. The latest June figure is based on the over 800 reporting hedge funds from around the world.

In comparison, the S&P 500 gained 1.3%, while the Average Taxable Bond Mutual Fund Index jumped 0.3% in the same period.

“Hedge funds continued their winning streak in June and, despite their hedged nature and exposure to other asset classes, generally kept pace with the resurgent equity markets. Gains were more modest across the board in June than in April or May but continued to be widespread,” Van Hedge Fund International said in a release.

Equity oriented strategies, which account for the majority of the world’s hedge funds, have also performed well so far as stocks attempt to pull out of a three-year bear market. Aggressive growth and value netted average returns of 2.2% and 1.6% in the global index for June respectively, increasing their year-to-date net gains to 13.2% and 9.9%.

The Van Offshore Hedge Fund Index, based on only non-US hedge funds, rose 1.3% for the month, generating a 7.5% net gain for the first half of the year.

The Van Global Hedge Fund Index climbed to a value of 9,769.8 in June. The index began with a value of 1,000 in January 1988.