Hedge funds ended May in positive territory with the Eurekahedge Hedge Fund Index up 1.15% as global markets showed signs of stabilization following a choppy start to the year.

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Year-to-date, hedge funds are up 1.91% while the MSCI World Index has returned 2.63% in the first five months of 2014.

Key takeaways for May 2014:

  • Global hedge funds crossed the US$2.1 trillion mark in May as fund managers delivered performance-based gains of US$9.29 billion during the month.
  • Hedge funds recorded their fourth consecutive month of positive asset flows with net capital allocations of almost US$60 billion year-to-date.
  • Event driven, multi-strategy and long/short equities strategies lead the tables delivering returns of 1.88%, 1.45% and 1.37% respectively.
  • Emerging markets-focused hedge funds delivered strong gains in May, up 2.24% with managers reporting strong gains from their exposure to India.
  • Japanese hedge funds reported their first month of positive returns for 2014, up 0.80% in May and have outperformed the benchmark Nikkei 225 index by 8.58% year-to-date.

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  • Fund managers using arbitrage strategies delivered their 11th consecutive month of positive returns, up 2.03% on a year-to-date basis.
  • Eastern Europe and Russia focused managers surpassed all regional mandates in May; gaining 8.37% as deescalating tensions in the area stabilized regional markets.
  • Islamic funds were the best performing investment vehicle for the year, driven by strong gains in Arabian markets. Equities in the GCC countries have witnessed a strong rally in 2014, with the Eurekahedge Middle East/Africa Islamic Fund Index gaining 10.18% as at May 2014 year-to-date.

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