Hedge fund performance was positive overall in May, rebounding from a slight decline in April, according to eVestment's May 2014 Hedge Fund Performance Report.
The industry returned 1.23 percent during the month and is up 2.20 percent year-to-date (YTD), on pace for an annualised return of 5.36 percent for the year.
Credit funds posted their ninth consecutive positive month in May, returning 1.03 percent and are the second best performing primary market-focus behind volatility strategies. The continued decline in United States Treasury yields has been a major boon for the universe which is on pace to return nearly 10 percent in 2014.
Activist hedge funds rebounded from declines in April with their largest monthly return since January 2013. The group has produced the highest volatility of any major strategy in 2014 and have deviations of returns lower than only sector specific equity and emerging market strategies across the whole industry.
Distressed funds had another solid month in May, returning 1.03 percent, which puts their 2014 performance ahead of all other major strategies, including activists.
After a strong month in April, commodity strategies were among the best performing segments of the industry, but sharp reversals in precious metals, grains and natural gas prices appeared to hurt the group in May.
Their decline of 0.52 percent in the month dropped them to a positive 1.67 percent for the year and into the middle of the pack for overall industry performance.
Emerging markets were again mixed in May as the unique risks and rewards of each country appear highly defined. Russia focused funds posted significant gains in May, but remain largely negative for the year, while the election results in India have kept the country’s momentum to the positive. India funds’ 17.47 percent rise in 2014 is by far the highest in the industry.
