Hedge funds enjoyed a strong start to 2013 with strategies exposed to equity risk posting their best returns in eight months.
As global markets gained momentum, a spread of hedge funds strategies delivered positive returns, with long/short equity funds posting a typical 3.40% for last month, while event driven strategies delivered 2.26%.
Recent reports by the EDHEC-Risk Institute found some strategies such as short selling cost hedge funds dear during 2012.
With a number of stock markets opening the year on a high, it is perhaps unsurprising short selling continued to hold them back in January.
According to the EDHC, these strategies posted losses of 4.9% during January, while the other 12 strategies it monitored ended the month in positive territory.