KEYWORDS: Asian Hedge Funds, China, credit hedge funds, CTA, Czech Republic, Emerging Markets, equity hedge funds, Equity markets, event driven, Germany, Global, global equity, hedge funds, Hungary, Italy, Japan, Korea, Morocco, Peru, Philippines, Poland, Short Selling, short selling ban, South Africa, Spain, Thailand, Turkey
Reinhardt Olsen, Ashley McLucas, Tim Wannenmacher, Robert Sachs, Michael Sales, Allan Ganly
UBS Prime Services’ Hedge Fund Monthly Update, July 2012 shows that, in In July, global equity markets twice sold off on poor economic data (e.g. disappointing US job reports, slowing Chinese growth, Spanish yields hitting all time highs) only to rally each time on the hopes of policy makers taking more action. For example, the MSCI World Index declined -3.5%, rallied +3.3%, declined -3.7% and then rallied +4.3%; not an easy environment for investing. For July, the MSCI World Index returned +1.2%; the S&P 500 returned +1.3%; the MSCI Euro +3.0%; and the MSCI AC Asia Pacific +1.2%. Equity volatility levels increased, but not by much considering this price action (VIX +10.8%; VSTOXX +12.3%; VHSI +1.4%).