HedgeCo.net (West Palm Beach) – Six months after their worst drawdown on record, hedge funds appear to be demonstrating stronger performance than in some previous recovery periods, such as during the Asian Currency Crisis and the Tech Bubble Burst events.

On average, it has taken hedge funds 13 months to recover from these market disruptions accordind to research peice by Credit Suisse Tremont Index LLC, the research reviews of how hedge funds have repositioned themselves in the first half of 2009 to generate positive returns for five out of the first six months of the year.

The report discusses how hedge funds, as measured by the Credit Suisse/Tremont Hedge Fund Index (“Broad Index”), have generated year-to-date returns of 7.2% through June 30, outperforming, with lower volatility, both key equity and bond indices. Some key takeaways from the report include:

The Convertible Arbitrage, Emerging Markets, and Global Macro sectors have received increased attention as investors began to regain their appetite for risk and global markets rallied.

Performance has improved across most sectors, with the bulk of returns for many strategies moving into positive territory for the year, with 80% of all funds reporting positive returns for the second quarter.

Overall industry assets under management have dropped approximately $18 billion since the end of the first quarter of 2009; we estimate industry assets totaled $1.3 trillion as of June 30 – down from $1.5 trillion at the end of 2008.

As of June 30, 2009, an estimated 9.6% of funds were classified as impaired, meaning they have either suspended redemptions, imposed gate provisions or sidepocketed assets.

Alex Akesson

Editor for HedgeCo.net
alex@hedgeco.net

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NASDAQ – Tribridge Investment Partners Ltd., a Hong Kong-based hedge fund manager, said Monday it will launch a new fund in August and hired John Liptak, former head of Bank of America Corp.’s Asia special situations group, to run it.

The new fund will have a pan-Asia focus and seek to identify mispriced or undervalued securities due to financial stress, some corporate event or other special situation. It will be biased toward large-cap companies in more developed markets in the region such as Hong Kong, Australia, Korea, Singapore, or Japan.

"I believe that the opportunities from the upcoming default cycle have not been seen since shortly after the Asian currency crisis back in 1997-1998," Liptak said in prepared remarks.

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Tags: asia focus, asian currency crisis, australia, bank of america, bank of america corp, cap companies, financial stress, hedge-fund-manager, hong kong, investment-partners, japan, korea, liptak, nasdaq, pan asia, singapore, special situations, tribridge