Hedge funds returned 1.26% in October, boosting year-to-date performance to 3.36%, according to the LJH Hedge Fund index. In contrast, the Standard & Poor's 500 index gained 1.9% in October but returned
-18.9% in the first 10 months of 2001.
Primary drivers of positive hedge fund performance came from four strategies: distressed securities, short only, convertible arbitrage and emerging markets fixed income. All posted double-digit returns year-to-date.