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Hedge Funds Continue Downward Trend

FAIRFIELD, Iowa, August 7, 2006 – Hedge fund performance slid 0.07% in July, according to flash estimates for the Barclay Hedge Fund Index.

“Once again, we’re seeing equity-based directional strategies spilling most of the red ink,” said Sol Waksman, founder and president of The Barclay Group.

“Share prices dropped during the first half of July, but by the end of the month rallied back to where they had started.”

Nine of Barclay’s 18 hedge fund indexes lost money during July. The Technology Index dropped 1.39%, Global Macro fell 1.36 %, Pacific Rim Equities were down 1.14%, and Equity Long Bias lost 1.12%.

“Macro Funds had to contend with a difficult environment, as prices in the energy markets continued the cycle of rally, retreat, and rally,” says Waksman.”

The strongest gainer in July was Barclay’s Equity Short Bias Index, up 2.84%.

“Even though July’s net change in US share prices was quite small, short bias funds were able to hold on to profits gained during the first half and end the month in positive territory.”

Barclay’s Convertible Arbitrage was up 0.69%, Fixed Income Arbitrage gained 0.53%, and Emerging Markets gained 0.39%.

“The stock indexes of the major emerging markets — Brazil, Russia, India, and China — all had gains this month.”

“Arbitrage strategies, which make investments based on price differences between securities of similar value, did well in July.”

Despite losing 2.29% during the past three months, the Barclay Hedge Fund Index is still up 5.57% for 2006.

Click here to view ten years of Barclay Hedge Fund Index data.

Sol Waksman, an experienced media source, provides perspectives on hedge fund and managed futures trends. For more commentary, call Sol at 641-472-3456 or email

The Barclay Group, founded in 1985, actively tracks more than 5,500 hedge funds and managed futures programs. Barclay has created and regularly updates 18 proprietary hedge fund indexes and eight managed futures indexes. Institutional investors, brokerage firms and private banks worldwide utilize Barclay’s indexes as performance benchmarks for the hedge fund and managed futures industries.