Index Flash

Hedge fund assets cross US$1.6 trillion

November 2010

Hedge funds witnessed another month of strong gains in October amid a

sustained rally in underlying global markets. The Eurekahedge Hedge
Fund Index gained 2.26%1 for the month, bringing the year-to-date
October returns to 7.31%. The MSCI World Index was up 3.65% in
October.

Key highlights for the month:

• Hedge funds were up 7.31% YTD October, ahead of global

markets by 2.71%

• Greater China hedge funds rose 10.69% in the last two months

• Strong launch activity was seen in the first three quarters, with
more than 600 funds launched in 2010 so far

• Global hedge fund assets crossed US$1.6 trillion

Main Indices

Oct 2010 2010 YTD 2009

Index
Est1 Returns Returns
Eurekahedge Hedge Fund Index 2.26 7.31 19.74
Eurekahedge Fund of Funds Index 1.45 2.98 9.39
Eurekahedge Long-Only Absolute
2.56 10.70 46.92
Return Fund Index
Eurekahedge Islamic Fund Index 1.76 6.51 21.59

In terms of regional mandates, Asia ex-Japan funds witnessed the

strongest returns, with managers investing in Greater China delivering
the best performance in October. The Eurekahedge Asia ex-Japan Hedge
Fund Index was up 3.11% in the month, finishing ahead of the MSCI AC
Asia Pacific Ex-Japan Index, which gained 2.65%. Managers investing in
China witnessed a second month of excellent returns – up 3.91%, taking
their two-month gain to 10.69%. Chinese managers were helped by a
strong run in the underlying equity markets – the Shanghai Composite
advanced 12.17% while the Hang Seng gained 3.30%.

Hedge funds in most other regions were also profitable in October as

expectations of further quantitative easing and better-than-expected
corporate earnings help underlying markets extend their rallies through
October. The Eurekahedge North American Hedge Fund Index was up

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Hedge fund assets cross US$1.6 trillion

2.42% as the S&P 500 posted a 3.69% gain, while Latin American and
European hedge funds delivered returns of 1.95% and 1.31%,
respectively.

Regional Indices

Oct 2010 2010 YTD 2009

Index
Est1 Returns Returns
Eurekahedge North American Hedge
2.42 8.35 23.50
Fund Index
Eurekahedge European Hedge Fund
1.31 5.45 20.18
Index
Eurekahedge Eastern Europe & Russia
2.72 11.08 60.08
Hedge Fund Index
Eurekahedge Japan Hedge Fund
-0.09 1.10 6.61
Index
Eurekahedge Emerging Markets
2.38 8.87 35.72
Hedge Fund Index
Eurekahedge Asia ex-Japan Hedge
3.11 9.08 38.24
Fund Index
Eurekahedge Latin American Hedge
1.95 8.13 28.62
Fund Index

Strategy Indices

Oct 2010 2010 YTD 2009

Index
Est1 Returns Returns
Eurekahedge Arbitrage Hedge Fund
1.63 7.21 21.66
Index
Eurekahedge CTA/Managed Futures
3.13 8.08 2.91
Hedge Fund Index
Eurekahedge Distressed Debt Hedge
1.90 11.56 32.90
Fund Index
Eurekahedge Event Driven Hedge
1.95 10.03 38.55
Fund Index
Eurekahedge Fixed Income Hedge
0.68 8.91 22.34
Fund Index
Eurekahedge Long/Short Equities
2.30 6.08 23.98
Hedge Fund Index
Eurekahedge Macro Hedge Fund
1.54 6.32 12.82
Index
Eurekahedge Multi-Strategy Hedge
2.17 7.24 21.09
Fund Index
Eurekahedge Relative Value Hedge
1.48 8.67 21.29
Fund Index

In terms of strategic mandates, hedge funds across the board ended the
month with healthy gains. CTA/managed futures funds stood out with the
best performance in October, gaining 3.13% on average, as managers
were able to capture most of the upside in rising commodity prices. A
weaker US dollar, as well as supply concerns, saw most commodity
contracts rise, gold hit a new record high of US$1,388 during the month
while soft commodities and crude oil finished the month higher. The S&P
Goldman Sachs Commodity Index advanced 2.56% in the month.
Managers investing in equity markets were able to deliver another month
of excellent returns as the Eurekahedge Long/Short Equity Hedge Fund
Index was up 2.30% in October. Distressed debt managers also
continued their winning ways, gaining 1.90% and increasing their year-

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Hedge fund assets cross US$1.6 trillion

to-date October return to a strong 11.56%.

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Eurekahedge
www.eurekahedge.com
+65 6212 0925

1
Based on 37.06% of funds reporting the NAV for October 2010 as of 9 November 2010.

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