Hedge Funds Up In August

Hedge fund returns inched up 0.7 percent in August as the U.S. stock market continued its third-quarter rally, according to industry tracker eVestment|HFN.

It was the third consecutive month of gains for the more than $2 trillion hedge fund industry, helping to push average yearly returns to 4.1 percent, data released on Thursday showed.

Still, hedge funds on average trailed the broader stock market, which gained 2.25 percent last month. The Standard & Poor’s 500 stock index rallied 13.5 percent through August 31.

Credit-focused funds, which have been one of the best-performing strategies in 2012, continued to make strides in August, rising 1.14 percent, the data showed. Those funds are up 7.5 percent, on average, year to date.

“There have been massive flows into credit strategies over the last seven months,” said Peter Laurelli, head of industry research for eVestment|HFN, which noted that performance drivers for credit-focused funds have included opportunities in the Eurozone, as well as the strength of mortgage and securitized credit markets here in the United States.

Read More: Reuters