First Quarter Hedge Fund Report

Hedge funds took modest advantage of March's upswings in the global equity and credit markets, according to Morningstars hedge fund performance summary for the first quarter of 2009.

Equity markets around the world significantly rebounded in March as appetite for risk returned, especially in emerging markets, according to the report. Positive lending and manufacturing news in China coupled with higher commodity prices, which helped stocks in other emerging economies such as Russia, drove the Morningstar MSCI Emerging Markets and Morningstar Emerging Markets Hedge Fund Indexes to increase 4.2% and 6.2%, respectively.

"In March we saw a recovery in equity and some credit markets, which helped hedge funds post small gains. But many hedge fund managers, believing that the economy is not yet out of hot water, continued to remain cautious, and were not strongly positioned to participate in the market rally," said Nadia Papagiannis, Morningstar hedge fund analyst. The Morningstar MSCI Developed Markets Hedge Fund Index rose only 1.1% in March compared to the MSCI World Index, which climbed 7.2%.

Hedge Funds in the Current Environment

In co-operation with the City Bar Center for Continuing Legal Education, Karl A. D'Cunha, a Senior Managing Director of Houlihan Smith & Company, Inc., will participate in a panel discussion involving industry experts and City Bar Center Faculty titled: "Hedge Funds in Distress" during the City Bar Center for CLE's program titled: "Hedge Funds in The Current Environment" moderated by Nora M. Jordan of Davis Polk & Wardwell.

The educational overview of "Hedge Funds in the Current Environment" will take place today at the Association House of the City Bar Center for Continuing Legal Education at 42 West 44th Street in New York.

Houlihan Smith & Company, Inc. is an investment banking firm that works with 20 of Alpha Magazine's "Top 100 Hedge Funds."