April 06, 2011

Hedge funds won't be too upset to see March in their rearview mirror. According to a blog posting from The Wall Street Journal, Japan's earthquake and tsunami had a big impact on the $2 trillion industry.

"Hedge funds had a challenging March," wrote Mary Ann Bartels, who tracks industry activity at Bank of America Merrill Lynch.

WSJ reports the following highlights or lowlights for hedge funds last month:

- Investable hedge-fund indexes tracked by Bartels lost 0.91% last month, through March 30, while the Standard & Poor's 500 index rose 0.08% in the same period.

- Equity market neutral and event-driven managers were the best performers in March, while long/short equity funds and trend-following funds known as commodity trading advisers, were laggards, according to Bartels.

- David Einhorn was down 2% in March, making it his toughest first quarter since 2007, according to Greenlight Capital Re (GLRE). This leaves him 3.4% down in the first quarter of 2011, according to Greenlight Capital Re's website.

- Man Group's AHL Diversified Futures fund lost nearly 5% between March 1 and March 28, according to regulatory filings.

It's not all bad news, however. Hedge funds that trade around corporate events, such as Dan Och's Och-Ziff Capital Management Group and Dan Loeb's Third Point, had a good month. Och-Ziff's (OZM) largest hedge fund-- the OZ Master Fund -- returned 0.48% last month, leaving it up 3.36% so far in 2011, according to a regulatory filing.

Third Point Offshore, a $3.3 billion hedge fund, returned 0.9% last month. The gains generated by Third Point leave the hedge fund up 8.6% so far in 2011, versus a 5.9% gain by the S&P 500, according to the filing.

Let's see if April is a month of growth or an extended winter.

ABOUT THE AUTHOR
Phil Albinus is the former editor-in-chief of Advanced Trading. He has nearly two decades of journalism experience and has been covering financial technology and regulation for nine years. Before joining ...