Index Flash

Hedge funds up 0.55% in November

December 2010

Main Indices

The Eurekahedge Hedge Fund Index was up 0.55%1 in November 2010,

with hedge funds recording flat to positive returns for the month across
the board. Hedge funds outperformed the underlying markets by 2.90%
as the MSCI Word Index2 dropped 2.35%.

Below are the key highlights for November:

• Early reporting funds indicate that US$5 billion went into the
industry in November.

• Japanese hedge funds have outperformed the Topix by almost

9% YTD November.

• Distressed debt hedge funds were the top performing strategic

mandate for the past two years, having gained almost 60% over
this period.

• Asia ex-Japan funds have witnessed six months of back-to-back

positive returns, up 12.50%.

Table 1: Main Indices

Nov 2010 2010 YTD 2009
Index
Est1 Returns Returns
Eurekahedge Hedge Fund Index 0.55 7.90 19.76
Eurekahedge Fund of Funds Index 0.12 2.77 9.38
Eurekahedge Long-Only Absolute
0.64 11.31 47.28
Return Fund Index
Eurekahedge UCITS Hedge Fund
0.55 5.21 18.72
Index

Regional Indices

Managers investing in Japan posted excellent returns and healthy fund

inflows amid a strong market rally. The Eurekahedge Japan Hedge Fund
Index, boosted by the index majority of Japanese long/short equity
hedge funds that maintained a net long bias position throughout
November, rose 2.42% in the month. Japanese managers have been
particularly adept at navigating through the volatile equity markets this
year – the Eurekahedge Japanese Long/Short Equity Index is up 2.48%
YTD November while the Topix is down 5.14% over the same period.
North American investing hedge funds also delivered noteworthy gains

1
 Index Flash

Hedge funds up 0.55% in November

for the month through their exposure to small-cap US stocks and the US
dollar. Standing as one of the top two best performing North American
strategic mandates for November, long/short equity managers raked in
gains to the tune of 1.89% while the S&P 500 Index finished the month
lower by 0.23%.

Most other Eurekahedge regional mandates ended the month in positive

territory, beating their respective underlying markets (as tracked by
MSCI indices). Despite mounting concerns over the fiscal health of some
EU members and their impact on the euro, the Eurekahedge European
Hedge Fund Index witnessed a gain of 0.37% as portfolio managers used
hedging techniques to protect early month gains. A higher Russian equity
index return for November also helped Eastern European hedge funds
generate an average profit of 1.72% as they maintained net long
exposures.

Table 2: Regional Indices

Nov 2010 2010 YTD 2009
Index
Est1 Returns Returns
Eurekahedge North American Hedge
0.98 10.06 23.34
Fund Index
Eurekahedge European Hedge Fund
0.37 6.07 20.26
Index
Eurekahedge Eastern Europe & Russia
1.72 12.29 59.73
Hedge Fund Index
Eurekahedge Japan Hedge Fund
2.42 3.59 6.58
Index
Eurekahedge Emerging Markets
-0.13 8.79 35.81
Hedge Fund Index
Eurekahedge Asia ex-Japan Hedge
0.18 9.09 38.19
Fund Index
Eurekahedge Latin American Hedge
0.51 8.70 28.68
Fund Index

Strategy Indices

Most strategic mandates delivered positive returns for November, with

event driven hedge funds standing out as the best performers. Increased
corporate activity in 2010 has helped event driven managers to register
excellent returns throughout the year, with the Eurekahedge Event
Driven Hedge Fund Index up 12.24% YTD November. Long/short equity
and multi-strategy funds were also up for the month, with their NAV’s
rising 1.25% and 1.27%, respectively, as managers successfully
exploited the volatile market conditions and locked in gains from both the
long and short side. Distressed debt funds also continued their upward
movement – the Eurekahedge Distressed Debt Hedge Fund Index’s
November return of 1.02% led the Merrill Lynch High Yield Index by
2.14%, even against the backdrop of a higher month-on-month default
rate. The YTD November return of distressed debt funds stands at a hefty
19.53%.

Table 3: Strategy Indices

Nov 2010 2010 YTD 2009
Index
Est1 Returns Returns
Eurekahedge Arbitrage Hedge Fund
-0.11 6.93 21.68
Index
Eurekahedge CTA/Managed Futures
-0.72 7.18 3.22
Hedge Fund Index
Eurekahedge Distressed Debt Hedge 1.02 19.53 32.89

2
 Index Flash

Hedge funds up 0.55% in November

Fund Index
Eurekahedge Event Driven Hedge
1.35 12.24 39.46
Fund Index
Eurekahedge Fixed Income Hedge
-0.79 8.30 22.56
Fund Index
Eurekahedge Long/Short Equities
1.25 7.33 23.80
Hedge Fund Index
Eurekahedge Macro Hedge Fund
0.15 6.29 13.02
Index
Eurekahedge Multi-Strategy Hedge
1.27 8.21 20.91
Fund Index
Eurekahedge Relative Value Hedge
0.95 9.69 21.16
Fund Index

Eurekahedge indices are available for download from

www.eurekahedge.com/indices/hedgefundindices.asp and are updated
with the latest fund returns at 23:30 GMT every day. Index values and
data can be downloaded for free and subscribers can download the full
list of index constituents. Please contact indices@eurekahedge.com for
more information.

For the latest ongoing promotions offered by Eurekahedge and our

marketing partners, please visit our promotions page,
www.eurekahedge.com/promotions.

Regards,

Eurekahedge
www.eurekahedge.com
+65 6212 0925

Follow us on Twitter @eurekahedge

1
Based on 32.06% of funds which have reported November 2010 as of 8 December 2010.

2
MSCI, The World Index Free Standard Core, USD

Click here to unsubscribe.

Copyright © 2005-2010 Eurekahedge Pte Ltd. All rights reserved. www.eurekahedge.com