Hedge fund indexes returned more than 10% in 2010, according to early reporting from major index providers.
For the year, Hedge Fund Research’s HFRI Fund Weighted Composite index was 10.42%; Hennessee Hedge Fund index, 10.2%; and HedgeFund Intelligence composite, 9.44%.
Hedge funds of funds’ 2010 returns were about half as large as those of single and multistrategy hedge funds. The HFRI Fund of Funds Composite index was up 5.42% for the year.
By comparison, one-year returns of other major market indexes were S&P 500 (with dividends), 15.08%; Barclays Aggregate Bond, 6.56%; and MSCI World, 9.55%.
According to HFR, the best-performing hedge fund strategy last year focused on energy investments, with the HFRI EH: Sector-Energy/Basic Materials index returning 15.98%; followed by the HFRI RV: Fixed Income-Asset Backed index, 14.32%; and the HFRI RV: Multi-Strategy index, 13.93%.
The only hedge fund strategy index with negative returns in the year ended Dec. 31 was the HFRI EH: Short Bias index at -21.30%.