Hedge funds trading convertible bonds were top performers amongst the hedge fund strategies in February, returning 1.67 per cent according t...

Hedge funds trading convertible bonds were top performers amongst the hedge fund strategies in February, returning 1.67 per cent according to French business school Edhec. And in the first two months of this year they have returned an average of 4.2 per cent, say Edhec. The current good run for convertible bond hedge funds is a considerable turnaround for the strategy, which over the past couple of years has returned flat or negative numbers and seen a huge flight of investors’ funds. According to analysts, there is now a conviction that the market is cheap and, because a lot of money left the strategy last year, there are more deals to go round. Emerging market hedge funds were the second top performer in February, according to Edhec. On average this strategy returned 1.53 per cent in February, although it is up 6.9 per cent for the first two months of this year. Managed futures was the only sector that returned a negative number, -1.96 per cent for February, wiping out January's gains and leaving the strategy down 0.3 per cent year-to-date.