Hedge funds started 2021 on a positive note returning 0.98% in January, according to the Barclay Hedge Fund Index compiled by BarclayHedge, a division of Backstop Solutions. By comparison, the S&P 500 Total Return Index was down 1.01% in January.

Gainers outnumbered losers in January among the sectors tracked in the Barclay Hedge Fund Indices, despite challenging news on both the economic and the COVID-19 pandemic fronts during the month.

“Most hedge funds sectors performed solidly during a complicated month,” said Sol Waksman, president of BarclayHedge. “Equity markets reached record highs before tailing off late in the month with the S&P 500 experiencing its worst week since October. Meanwhile, COVID cases surged once again, leading to a U.K. lockdown and a downturn in U.S. employment. Despite the negatives, the hedge fund industry managed to produce a positive month in January.”

Setting the pace among January’s gainers was the Healthcare & Biotechnology Index, up 3.90%. The Merger Arbitrage Index returned 3.65%, the Emerging Markets Asian Equities Index gained 3.46%, the Emerging Markets Sub Saharan Africa Index returned 2.41%, and the Convertible Arbitrage Index advanced 2.36%.

Sectors in the red for January included the Emerging Markets Latin American Equities Index, down 2.48%, the Volatility Trading Index, giving up 1.06%, the Emerging Markets MENA Index, losing 0.92%, the Global Macro Index, off 0.54%, and the Fund of Funds Index, retreating 0.46%.

For a complete table of BarclayHedge Hedge Fund and Sub-Index results for January, as well as historical returns, click here.