In February 2006, the S&P's overall hedge fund index returned 0.8 percent, bringing the total for 2006 till now to 2.83 percent. That compares with 0.05 percent and 2.59 percent for the S&P 500 index. Reuters reports:
Arbitrage hedge funds buy and sell securities against each other and include convertible bond managers. S&P's arbitrage hedge fund index returned 1.24 percent in February and 2.63 percent for the year to date. A dearth of new issues and low volatility has over the past two years squeezed returns in the convertible bond sector to around zero.
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