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Hedge Funds

HFR: Hedge funds enjoy strong rally in first quarter

Aggregate hedge fund returns were strongly positive in the first quarter, in sharp contrast to the previous quarter, performance data released Friday by Hedge Fund Research showed.

The HFRI Fund Weighted Composite index was up 5.88% in the three months ended March 31 while the HFRI Asset Weighted Composite index was up 3.12%.

The three-month return of the HFRI Fund Weighted Composite index as of March 31 was the highest first-quarter return since the first quarter of 2006, when the index was up 5.98%. The return of the HFRI Asset Weighted Composite index in the quarter ended March 31 was the best since the 3.25% return in first quarter 2013.

In the previous quarter, the return of the HFR fund-weighted composite index was down 6.01% and the asset-weighted composite index return was a negative 2.37%, HFR data showed.

Returns of both indexes were flat in first quarter 2018 with the HFRI Fund Weighted Composite index down 0.04% and the HFRI Asset Weighted Composite index return up a slight 0.48%

"Risk-on sentiment dominated both hedge fund and global financial market performance in the first quarter of 2019, marking a sharp reversal from the risk-off sentiment which dominated the fourth quarter of 2018," said Kenneth J. Heinz, HFR's president, in a news release accompanying the firm's first quarter performance report.