Business as Usual for Hedge Funds; Despite Small Drop in October, Average U.S. Fund Continues to Preserve Capital.Business Editors NASHVILLE, Tenn.--(BUSINESS WIRE)--Nov. 7, 2000 Preliminary estimates show the Average U.S. Hedge Fund hedge fund, in finance, a highly speculative, largely unregulated investment device. Originating in the 1950s, the funds "hedge" by offsetting "short" positions (borrowing a security and then selling it at a higher price before repaying the lender) against "long" dropped -1.7% net in October, compared with a -0.4% return for the S&P 500 and declines of -4.5% and -8.2% for the Russell 2000 and NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on , reported Steven A. Lonsdorf, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Van Hedge Fund Advisors International, Inc., a global hedge fund advisory firm. The Average U.S. Hedge Fund remains out in front for the year to date through October, at 11.8% net. In comparison, all of the major indices are negative through October. The Russell 2000 finally succumbed in October, and the Dow, despite gaining 3.1% net in October, remains negative for the year as well. The S&P 500, the Dow and the NASDAQ are down -1.8%, -3.4% and -17.1%, respectively. "With the continued volatility in the markets, short sellers are once again emerging as early favorites for the month of October. However, none of the top five hedge funds reporting for this preliminary index were short sellers; three were value funds and two were aggressive growth. Together, they posted a 12.7% average net return. "With all of the major indices still in the red, it is uncertain whether they will be able to bounce back bounce v. bounced, bounc·ing, bounc·es v.intr. 1. To rebound after having struck an object or a surface. 2. in the next two months. When compared with the strong year-to-date performance of the Average U.S. Hedge Fund, the value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. by these managers' hedged portfolios Hedged portfolio A portfolio consisting of a long position in the stock and a long position in the put option on the stock, so as to be riskless and produce a return that equals the risk-free interest rate. is very easy to see," Lonsdorf concluded. Final October performance for U.S., Offshore and Global hedge funds, by strategy, will be released later this month. A registered investment advisor Registered Investment Advisor (RIA) is a designation obtainable in the United States by an individual who has registered with the U.S. Securities and Exchange Commission or state regulatory agency (where the primary business is situated or multiple States in some cases) in , Nashville, Tenn.-based Van Hedge Fund Advisors International, Inc. introduces top-performing hedge funds to substantial investors in the U.S. and abroad. The Company's information on hedge funds is based on information received (and not audited or independently verified) from the hedge funds in its databases and may not be representative of all hedge funds. Hedge fund returns are net of fees and performance allocations. The timing of the deduction of such fees and performance allocations may affect the reported performance. Different statistics may be based on different numbers of funds. Averages are not dollar-weighted. Past results are not necessarily indicative of future performance. |
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