Hedge Fund Performance Aug 08

It seems that August 2008 was a month of good old fashioned flight to quality - read the details of hedge fund performance below. Note how badly the Emerging Markets Funds have done. This also highlights the case that many hedge funds are highly paid "mutual funds that use asset classes in addition to stocks!". EM funds do badly when VIX jumps up, Put call variable from CBOE is significant and when yield spreads widen.....
I also sense a long dollar story here....

For the first month in three fixed income CEFs (+0.60%) managed to move into the black during the month of August, while equity funds continued to struggle (-1.13%), cumulatively posting a minus 0.05% return on a NAV basis.

On the stock side Domestic Equity Funds (+0.04%) and Mixed-Equity Funds (+0.06%) outpaced their World Equity Funds(-4.40%) counterparts.

- Six of Lipper's 12 equity CEF classifications were able to post a plus-side NAV-based return in August, with Value Funds (+0.65%), Options Arbitrage/Options Strategies Funds (+0.64%), and Growth Funds (+0.56%) leading the way.

- The Emerging Markets Funds (-6.44%) group posted the worst return in the CEF universe.

- For the third consecutive month the median discount of all CEFs widened--by 80 basis points (bps) to 9.18%. The High Current Yield Funds macro-group witnessed the largest widening of discounts (146 bps to 12.22%).