Hedge funds recoup some COVID-19 induced losses


Hedge funds have recouped some of the losses they suffered amidst pandemic-induced market chaos, according to the Eurekahedge Hedge Fund Index, which was up 3.73% in April — recording its strongest monthly performance in recent years.

The improvement was supported by the strong performance of the underlying global equity market. Global equities enjoyed a strong rally throughout the month on the back of market optimism over the development of potential vaccines and reopening of the economy.

In the US, the implemented lockdown and social distancing measures to curb the COVID-19 outbreak resulted in the loss of more than 22 million jobs in April, pushing the unemployment rate to 14.7% — a level not seen since the Great Depression. However, US equity benchmarks recorded their strongest performance since 1987, with the S&P 500 and tech-heavy NASDAQ gaining 12.68% and 15.45% during the month respectively.

In the same vein, European equities posted strong performance as most countries in the region were on track to ease their lockdown on top of the approved half-trillion economic stimulus by the European Union. The DAX and CAC 40 were up 9.32% and 5.02% respectively.

In Asia, equity markets in the region also enjoyed a strong rebound driven by the risk-on sentiment in the markets, with the KOSPI and CSI 300 Index ending the month of April up 10.99% and 6.14% respectively.

Eurekahedge Hedge Fund Index, Hedge Funds, Coronavirus, Cayman Islands

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