BLBG: Currency Funds Had Best Monthly Returns Since 2003, Parker Says
By Jamie McGee
Dec. 2 (Bloomberg) -- Foreign-exchange funds had their biggest monthly returns in October since 2003 as investors sold higher-yielding assets and bought the U.S. dollar, according to Parker Global Strategies LLC.
Currency funds gained 2.53 percent in October, according to the Stamford, Connecticut, firm, whose Parker FX Index tracks 68 firms managing more than $36 billion in assets. John W. Henry International Foreign Exchange Program of Boca Raton, Florida, was the top-performing fund in October, gaining 32.7 percent.
“The month saw a continuation of the dollar appreciation due to a combination of a flight to safety out of risky emerging-market currencies and into the stable dollar and the hoarding of liquidity by U.S. banks, creating a vacuum of dollars,” Parker Global said in a report today.
The ICE’s Dollar Index, which tracks the dollar versus a basket comprising the euro, yen, British pound, Canadian dollar, Swedish krona and Swiss franc, increased 7.8 percent in October, the biggest monthly gain since 1992. It has advanced for five straight months, rising 1 percent in November.
Most of the funds gained in October, with 46 of 71 programs reporting positive results and 25 posting losses, Parker Global said. Funds that tend to be based on computer models gained 3.02 percent, while discretionary traders, who usually make decisions based on economic trends, were up 1.43 percent, according to Parker Global.
To contact the reporter on this story: Jamie McGee in New York at jmcgee8@bloomberg.net
