The final result for 2011 is in: hedge funds posted one of their worst annual performances ever, according to data released on Monday.
The average hedge fund sank 4.8 percent in 2011, data compiled by Hedge Fund Research showed. The Standard and Poor’s 500 stock index, by comparison, ended the year roughly flat. In 2010, the average hedge fund rose by more than 10 percent.
2011 marks only the third calendar year since HFR began measuring industry-wide performance in 1990 that hedge funds have finished in the red.
Dov Gertzulin's DG Capital is having a strong year. According to a copy of the hedge fund's letter to investors of its DG Value Partners Class C strategy, the fund is up 36.4% of the year to the end of June, after a performance of 12.8% in the second quarter. The Class C strategy is Read More
It is also the industry’s second decline in four years.
Even though the fourth quarter of 2011 saw hedge funds gain 1.3 percent, that small boost barely helped firms whipsawed by record volatility in the third quarter as the European sovereign debt crisis sent markets into freefall, and the U.S. economy stagnated. Hedge funds lost almost 7 percent from the beginning of July through September 30.
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