Hedge Fund Reader : S&P; Suspends Hedge Fund Index

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June 30, 2006

S&P; Suspends Hedge Fund Index

Standard & Poor's said that it would no longer publish its managed account-based Hedge Fund Index from July 1, 2006. The decision may come as a surprise for the industry watchers. However, there are several factors attached to S&P;'s decision. In the recent moths, there have been diminishing numbers of managed accounts and their distribution in the index. That forced S&P; HFI not to become representative of the broad range of strategies employed by hedge funds. It finally took the decision of not publishing the index. The fallout from the meltdown of commodity broker Refco Inc. has also been cited as one of the reasons behind the unprecedented decision.

According to CNN Money -

The Hedge Fund Index, which launched in October 2002, tracked the daily performance of nine different hedging strategies, measured by results from about 40 hedge funds. The index has seen more than a dozen deletions of constituent funds since the start of this year, according to the paper.

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June 30, 2006 in Strategy | Permalink