Credit Suisse/Tremont Hedge Fund Index Registers March Gain

by Carla Johnson, Investors Offshore.com

19 April 2006

The Credit Suisse/Tremont Hedge Fund Index finished March up 1.82% as hedge funds enjoyed one of their most successful first quarters of recent years, with strong equity markets driving returns higher.

“The equity market strengthened as a four-year high in consumer confidence, better than expected employment figures, and extensive corporate activity contributed to the Long/Short Equity sector’s positive performance of 2.45% in March,” stated Oliver Schupp, President of the Credit Suisse/Tremont Hedge Fund Index.

“Convertible Arbitrage managers continued their upward trend with a 1.48% return for March. The sector profited from new issuances and increased trading volumes, resulting in a first quarter return of 5.51%," he added.

Overall, the Credit Suisse/Tremont HFI finished the first quarter of 2006 up by 5.46%.

“Managed Futures was the strongest performing sector this month with a return of 4.08%, benefiting from a weaker USD and a strengthened commodities market, particularly in base metals with both zinc and copper trading at record highs,” noted Robert I. Schulman, Chief Executive Officer of Tremont Capital Management, Inc.

“As the S&P 500 and other indices hit their highest volume levels in over three years, strong momentum and value/growth factors influenced the positive Equity Market Neutral performance with a 1.62% return in March," he added.

The S&P 500 index gained 1.24% in March, and is up by 4.21% year-to-date.

Multi strategy and long/short equity funds also performed well during March, gaining 2.05% and 2.45% respectively over the course of the month. Emerging market strategies also paid dividends, gaining 1.37% in March and 8.89% year-to-date.

Unsurprisingly, given the strength of the equity markets, short-biased strategies have found the going tough, losing 3.32% in March. Short-biased strategies are down 5.83% year-to-date.

The Credit Suisse/Tremont Index is constructed using the firm's own database of more than 4,500 hedge funds. It includes both open and closed funds located in the US and offshore, but does not include funds of funds.

In order to qualify for inclusion in the index selection universe, a fund must have a minimum of US$50 million under management, a 12-month track record, and audited financial statements.

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