(Investment Europe) – Data from Eurekahedge suggest that the hedge fund industry grew its total assets by $75bn through 2012, as its own benchmark Hedge Fund Index underperformed the MSCI World over the year.
The data provider, which monitors some 26,000 products including hedge funds, funds of funds, Ucits, private equity, Islamic and property funds, said managers faced a difficult trading environment over the period.
Markets were hit by risk-on and risk-off modes driven by political and macro events rather than fundamentals.
The Eurekahedge Hedge Fund Index was up 1% in December, bringing the yearly number to 5.63%. The MSCI World Index1 returned 2.28% in December and was up 13.75% for year 2012.
These overall figures hide some significant performance differences between discrete months.
Eurekahedge said that hedge funds started the year on a strong positive note, gaining 4.16% in the first two months before posting losses for four consecutive months. Performance rebounded in the second half of the year, with hedge funds gaining 3.92%, when markets rallied amid positive announcements by governments around the world.