The Eurekahedge Report - June 2012

Hedge funds outperformed underlying markets by 7.77% in May. The composite Eurekahedge Hedge Fund Index was down only 1.55% on the month as regional equities around the globe tumbled. Comparatively, the MSCI World Index lost 9.32% while stocks in Europe and Latin America witnessed losses of 13.42% and 13.48% respectively. All regional hedge fund mandates finished the month with negative returns although managers across the board were able to control their losses and protect their portfolios. Political instability in Europe, coupled with slowing growth in China prompted clients to redeem US$8.68 billion from hedge funds, while performance flows amounted to a decline of US$5.01 billion. Total industry assets however are higher by 2.42% year-to-date and remain above the US$1.74 trillion mark.

Highlights of hedge fund performance and asset flows for the month are as follows:

May 2012	US$ billion
Allocation (Inflows)	8.69
Redemption (Outflows)	-17.37
Net Asset Flows	-8.68
Positive Performance (Growth)	30.05
Negative Performance (Decline)	-35.06
Total	5.01
Overall Total	-13.69

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Hedge funds outperform underlying markets by 8.08% in May

Hedge funds were down for the third consecutive month in May amid broad declines in global markets

The Eurekahedge Hedge Fund Index lost 1.24% during the month, bringing the year-to-date (YTD) May return to 2.23%. In comparison the MSCI World Index was down by 9.32%.

Key highlights for May 2012:

• Hedge funds outperformed underlying markets by 8.08% in May.
• CTA/managed futures funds gain 2.60% in largely negative month, along with a 0.65% gain in the Mizuho-Eurekahedge Macro Index.
• Assets in macro hedge funds at historical high levels, cross US$140 billion for the first time.
• Nearly 350 new hedge funds have been launched in the first five months of the year.
• 920 hedge funds are up more than 10% YTD with the most prolific strategy amongst this group being long short equities.
• In addition 153 funds are up more than 20% and 10 funds are up more than 50%.

To read more, please see the full Eurekahedge Index Flash, also accessible on Scribd and Issuu.