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Markets: The short view

John Authers provides an interesting summary of first quarter stock market returns in today's FT print Short View column. It turns out that just about everything was down in US dollar terms, save one hedge fund strategy area:

"Anyone who made money in stocks during the first quarter has some tough questions to answer. The sell-off was so wide that you could only have done so by taking extravagant risks - unless you bet stocks would fall.

International equities fell almost equally once currency is taken into account; the S&P 500 fell 9.5 per cent and, in dollar terms, the MSCI EAFE index of non-US developed markets fell 8.8 per cent. MSCI's emerging markets index fell 11 per cent. "

There was, as previously noted, one bright spot for hedge fund investors mentioned further down in the column.

"But there was much money to be made by anyone making bold bets between asset classes, the terrain of macro hedge funds.

Early figures from Hedge Fund Research of Chicago show macro funds up 9.8 per cent for the quarter. All other strategies it covered, bar merger arbitrage, showed serious losses."

It's been a tough time for predominately long investors in recent months. Even the favored new bandwagon bet, long commodities/short the dollar, has taken a hit in recent weeks.

For more, see the Short View video clip of the "First quarter review".

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