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Hedge Funds Cooling In August

Hedge funds seem to be struggling again this month.

Hedge funds seem to be struggling again this month. Mid-month, the Dow Jones Hedge Fund Strategy Benchmarks indicate that four of its six strategies are in negative territory, with only convertible arbitrage shining, rising 1.1% so far, and equity market neutral inching up 0.5%. The other four strategies recorded drops of between 0.2% and 0.6%, with equity long/short back to zero growth year-to-date after climbing out of negative territory last month. Distressed securities still have the best 52-week growth, at 10.1% (down from 10.7% at the end of July), followed by convertible arbitrage at 8.4% (up from 7.7%). Worst 52-week performer: equity long/short at 2.7%. In related index news, volatility as a result of Middle East instability and worries about hurricane season helped push up hedge funds that focus on short-selling 2.9% in July, according to Credit Suisse/Tremont Hedge Fund Index.

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