New York (HedgeCo.Net) – The Hennessee Hedge Fund Index (-0.95%) declined less than the S&P 500 (-1.55%) and Russell 2000 Index (-6.19%) due to market hedges that have been in place for a long time, expecting the 10% correction that has not happened in three years.

The S&P 500 lost -1.55% (+6.70% YTD), the Dow Jones Industrial Average slipped -0.32% (+2.81% YTD), and the NASDAQ Composite Index dropped -1.90% (+7.59% YTD). Bonds were also negative on the month, as the Barclays Aggregate Bond Index decreased -0.68% (+4.09% YTD).

“The Hennessee Hedge Fund Index was down -0.95% with the top three strategies for the month being Short Biased (+3.15%), Multiple Arbitrage (+1.17%) and Macro (+0.51%).” Charles Gradante, Co-Founder of Hennessee Group LLC said. “The bottom three strategies for the month were Latin America (–8.09%), Opportunistic (-3.24%) and Value (-3.01%).”

Equity long/short hedge funds were negative in September, as the Hennessee Long/Short Equity Index lost -1.26% (+2.54% YTD). The best performing sectors were telecommunication services (+0.35%), health care (+0.32%), and consumer staples (+0.27%), while underperforming sectors were energy (-7.64%), consumer discretionary (+2.92%) and utilities (+2.15%). The healthcare sector continues to be the best performing sector for the year having gained +15.21% YTD through September, while consumer discretionary is bringing up the rear, having lost -0.23% YTD through September.

“In September the Fed cut monthly bond purchases by $10 billion, advancing the Feds plan to conclude the stimulus at the end of its next meeting in October.” reported Charles Gradante. “Managers are still contemplating the market implications of the 14 to 3 vote by the Fed to increase short-term rates in 2015, creating great difficulty in managing exposures as the interpretation of this move by the Fed has no historical basis.”