Hedge Fund Industry Loses 0.11% in October, According to Backstop BarclayHedge

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Spiking COVID-19 infection rates, new government lockdowns, stalled U.S. stimulus efforts contribute to a second straight month of hedge fund losses

The hedge fund industry posted a second consecutive monthly loss in October, down 0.11% for the month, according to the Barclay Hedge Fund Index, compiled by BarclayHedge, a division of Backstop Solutions. Once again, however, the hedge fund industry outperformed the S&P 500 Total Return Index, which was down nearly 2.66% in October.

For the year-to-date, the hedge fund industry remained in positive territory, up 1.58% through the end of October. Over the same period, the S&P 500 Total Return Index was up 2.77%.

By sector, results were mixed in October, though monthly gainers outnumbered losers among the Barclay Hedge Fund Indices.

“Worrisome worldwide spikes in COVID-19 infection rates, soft shutdowns in Europe and stalled stimulus talks in the U.S. dragged down stock markets and energy prices,” said Sol Waksman, president of BarclayHedge. “Positive economic news did manage to come out of China. The pandemic there was largely under control and economic growth surged in the third quarter.”

Setting the pace for October’s gainers was the Emerging Markets Global Equities Index, up 1.98% for the month. The Technology Index gained 1.86% in October, the Healthcare & Biotechnology Index returned 1.76%, the Pacific Rim Equities Index advanced 1.62% and the Emerging Asian Equities Index rose 1.42%.

Among the sectors in the red for the month were the European Equities Index, down 3.03%, the Emerging Markets Eastern Europe Index, down 2.79%, the Emerging Markets Latin American Equities Index, off 2.65%, the Global Macro Index, retreating 1.21%, and the Equity Long Bias Index, falling 1.10%.

Year-to-date gainers again remained in the majority, led by the Technology Index, up 16.99%. Others in the black through October included the Volatility Trading Index, gaining 12.20%, the Emerging Markets Asian Equities Index, returning 10.97%, the Healthcare & Biotechnology Index, up 10.19%, and the Fixed Income Arbitrage Index, rising 8.58%.

Sectors falling back so far in 2020 were led by the Emerging Markets Latin American Equities Index, which declined 19.28%. The Emerging Markets Eastern European Equities Index dropped 9.58% through October, the Emerging Markets MENA Index fell 6.75%, the European Equities Index lost 3.74% and the Emerging Markets Global Equities Index was off 2.85%.

For a complete table of BarclayHedge Hedge Fund and Sub-Index results for October, as well as historical returns, click here.

About Backstop Solutions

Backstop’s mission is to help the institutional investment industry use time to its fullest potential. We develop technology to simplify and streamline otherwise time-consuming tasks and processes, enabling our clients to quickly and easily access, share and manage the knowledge that’s critical to their day-to-day business success. Backstop provides its industry-leading cloud-based productivity suite to investment consultants, pensions, funds of funds, family offices, endowments, foundations, private equity, hedge funds and real estate investment firms.

BarclayHedge, a division of Backstop, currently maintains data on more than 6,900 hedge funds, funds of funds and CTAs. The BarclayHedge Indices are utilized by institutional investors, brokerage firms and private banks worldwide as performance benchmarks for the hedge fund and managed futures industries.

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