Early July Returns Largely Flat, Trailing Equities
Global hedge funds, measured by the Bloomberg Aggregate Hedge Fund Index, climbed 0.2 percent in July, trailing stocks, as the MSCI All-Country World Index returned 1.4 percent on speculation the ECB would buy bonds to help cut borrowing costs and save the euro. Global macro funds advanced while long-short equity and multistrategy managers declined. MKP Capital Management LLC, the $4.9 billion New York-based firm, and some smaller funds posted positive returns.
“People are in that cautious watch-and-don’t-do-anything mode,” Emma Sugarman, global head of capital introduction at BNP Paribas SA in New York, said of hedge-fund managers. “We had some pretty intense intra-month volatility.”
The aggregate Bloomberg index advanced 1.9 percent in the first seven months of the year, compared with a 7.5 percent gain for equities worldwide, including dividends.
MKP climbed 1.4 percent in July in its MKP Opportunity fund, bringing this year’s gain to 4.7 percent, according to a person with knowledge of the matter, who asked not to be identified because the information isn’t public. The fund has $2.5 billion in assets and is run by Patrick McMahon.
MKP Credit rose 2.8 percent last month and 6.5 percent this year. The $1.9 billion fund is managed by Anthony Lembke. Konstantin Shishkin, a spokesman for MKP Capital, declined to comment on the returns.