Short selling strategies continued to add to positive year-to-date gains in July, despite another drop in returns from hedge funds tracked by Greenwich Alternative Investments.

With an average return of 9.76 per cent, the oft-criticised short sellers have been among the few successful hedge fund strategists over the year to date. Last month short sellers gained an average 0.30 per cent, while most other hedge fund strategies continued to lose ground. Futures strategies, which have been equally successful over the year with an average 9.26 per cent, suffered a sharp drop in July, shedding 3.22 per cent. A report released by Greenwich said that the abrupt unwinding of several popular hedge fund strategies had led the Greenwich Global Hedge Fund Index (GGHFI) and the Greenwich Composite Investible Index (GI2) to post losses of -2.31 per cent and -1.72 per cent respectively over the past month. Long/short equity funds suffered as growth and value managers reported declines of -3.31 per cent and -2.32 per cent respectively, while emerging market funds once again reported the biggest losses, declining in step with global equity bourses. Margaret Gilbert, managing director at Greenwich, noted that while hedge funds as a group had clearly had a weak month, the year-to-date returns still outpaced traditional long-only investment vehicles.