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Reuters
13-06-2025
- Business
- Reuters
Trend hedge funds struggle as more nimble macro funds embrace whipsawing markets
LONDON, June 13 (Reuters) - Hedge fund returns so far this year show a stark divide between those that have been able to navigate U.S. President Donald Trump's erratic decision making and switch tactics quickly and those hemmed in by algorithmic strategies. Systematic hedge funds, whose algorithms ride market trends until they peter out, are down over 11% so far this year to end-May, according to a Societe Generale ( opens new tab client note seen by Reuters this week. Global funds such as Systematica, Transtrend and Aspect Capital - between them managing almost $30 billion - run strategies that are down around 18.5%, 16.3% and 15% respectively, according to Transtrend's website and two sources close to the matter. The funds declined to comment. In contrast, hedge funds that use their discretion on the timing of trades and the asset classes they choose were up almost 7% by the end of May, data from hedge fund research firm PivotalPath shows. "Trend funds have been whipsawed and haven't been able to latch on to any consistent trend," said PivotalPath's head of manager relations, Gwyn Roberts. "Every time trend funds have begun to latch on to a market move this year, it has changed." The broadest index of European stocks (.STOXX), opens new tab gained around 10% from the start of the year to February 28 before falling by 20% over two weeks from March 25, a period that included Trump's April 2 Liberation Day tariff announcement. U.S. stocks trod a similar rocky path (.SPX), opens new tab. The "worst" positions causing negative returns for trend funds included U.S. Treasuries, the Australian dollar, Japanese government bonds and in May, coffee, SocGen's report said. However, the dispersion between the two types of hedge funds has narrowed since April as markets swung back again. Discretionary macro hedge funds have achieved broadly positive returns over the first five months of the year. Rokos Capital Management, with $22 billion in assets, had returned 9.5%, according one source, with EDL Capital up 24%, according to a second. Brevan Howard's Alpha Strategies was up 4.32%, although its flagship fund is down 2.12%, said a third source. Macro traders in general have averaged an 8.5% annual return while managed futures traders, which include trend funds, have averaged a 7.2% annual return since PivotalPath began collecting data in 1998, with discretionary macro traders increasing that to an average of 9.6% since 2001. "Managed futures tend to be used in investor portfolios as a defensive allocation, which performs well when other strategies struggle," said PivotalPath's Roberts. Some large hedge funds have both macro and trend funds, which buffer each other. Man Group's (EMG.L), opens new tab systematic AHL Alpha Programme is down 10.6% for the year but its multi-strategy fund is up around 5.4%, according to the hedge fund's website. AQR Capital Management, which oversees $135 billion, posted a 10.6% return in its multi-strategy Apex fund to end-May. Bucking the trend, its Helix alternative trend strategy was also up, by 7%, although flat last month as it contended with reversals across interest rate swaps and yield curves. An almost 9% return in Graham Capital Management's Multi-Alpha Opportunity fund this year offset an 8.7% fall in its Tactical Trend fund, according to SocGen. Graham declined to comment on the results, but the founder of the $20 billion hedge fund, Ken Tropin, told Reuters that when trends "reverse violently", it "generally hasn't paid to overreact and deviate from trading models that have historically performed well in a variety of market cycles". In a note to clients, Adam Singleton, CIO of Solutions at Man Group, said May was a mixed month for discretionary macro strategies, adding that positions betting on a rise in stocks, the euro and the yen boosted performance while certain relative fixed income trades had hurt some.
Yahoo
13-06-2025
- Business
- Yahoo
Analysis-Trend hedge funds struggle as more nimble macro funds embrace whipsawing markets
By Nell Mackenzie LONDON (Reuters) -Hedge fund returns so far this year show a stark divide between those that have been able to navigate U.S. President Donald Trump's erratic decision making and switch tactics quickly and those hemmed in by algorithmic strategies. Systematic hedge funds, whose algorithms ride market trends until they peter out, are down over 11% so far this year to end-May, according to a Societe Generale client note seen by Reuters this week. Global funds such as Systematica, Transtrend and Aspect Capital - between them managing almost $30 billion - run strategies that are down around 18.5%, 16.3% and 15% respectively, according to Transtrend's website and two sources close to the matter. The funds declined to comment. In contrast, hedge funds that use their discretion on the timing of trades and the asset classes they choose were up almost 7% by the end of May, data from hedge fund research firm PivotalPath shows. "Trend funds have been whipsawed and haven't been able to latch on to any consistent trend," said PivotalPath's head of manager relations, Gwyn Roberts. "Every time trend funds have begun to latch on to a market move this year, it has changed." The broadest index of European stocks gained around 10% from the start of the year to February 28 before falling by 20% over two weeks from March 25, a period that included Trump's April 2 Liberation Day tariff announcement. U.S. stocks trod a similar rocky path. The "worst" positions causing negative returns for trend funds included U.S. Treasuries, the Australian dollar, Japanese government bonds and in May, coffee, SocGen's report said. However, the dispersion between the two types of hedge funds has narrowed since April as markets swung back again. MACRO UP Discretionary macro hedge funds have achieved broadly positive returns over the first five months of the year. Rokos Capital Management, with $22 billion in assets, had returned 9.5%, according one source, with EDL Capital up 24%, according to a second. Brevan Howard's Alpha Strategies was up 4.32%, although its flagship fund is down 2.12%, said a third source. Macro traders in general have averaged an 8.5% annual return while managed futures traders, which include trend funds, have averaged a 7.2% annual return since PivotalPath began collecting data in 1998, with discretionary macro traders increasing that to an average of 9.6% since 2001. "Managed futures tend to be used in investor portfolios as a defensive allocation, which performs well when other strategies struggle," said PivotalPath's Roberts. Some large hedge funds have both macro and trend funds, which buffer each other. Man Group's systematic AHL Alpha Programme is down 10.6% for the year but its multi-strategy fund is up around 5.4%, according to the hedge fund's website. AQR Capital Management, which oversees $135 billion, posted a 10.6% return in its multi-strategy Apex fund to end-May. Bucking the trend, its Helix alternative trend strategy was also up, by 7%, although flat last month as it contended with reversals across interest rate swaps and yield curves. An almost 9% return in Graham Capital Management's Multi-Alpha Opportunity fund this year offset an 8.7% fall in its Tactical Trend fund, according to SocGen. Graham declined to comment on the results, but the founder of the $20 billion hedge fund, Ken Tropin, told Reuters that when trends "reverse violently", it "generally hasn't paid to overreact and deviate from trading models that have historically performed well in a variety of market cycles". In a note to clients, Adam Singleton, CIO of Solutions at Man Group, said May was a mixed month for discretionary macro strategies, adding that positions betting on a rise in stocks, the euro and the yen boosted performance while certain relative fixed income trades had hurt some. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-06-2025
- Business
- Yahoo
Analysis-Trend hedge funds struggle as more nimble macro funds embrace whipsawing markets
By Nell Mackenzie LONDON (Reuters) -Hedge fund returns so far this year show a stark divide between those that have been able to navigate U.S. President Donald Trump's erratic decision making and switch tactics quickly and those hemmed in by algorithmic strategies. Systematic hedge funds, whose algorithms ride market trends until they peter out, are down over 11% so far this year to end-May, according to a Societe Generale client note seen by Reuters this week. Global funds such as Systematica, Transtrend and Aspect Capital - between them managing almost $30 billion - run strategies that are down around 18.5%, 16.3% and 15% respectively, according to Transtrend's website and two sources close to the matter. The funds declined to comment. In contrast, hedge funds that use their discretion on the timing of trades and the asset classes they choose were up almost 7% by the end of May, data from hedge fund research firm PivotalPath shows. "Trend funds have been whipsawed and haven't been able to latch on to any consistent trend," said PivotalPath's head of manager relations, Gwyn Roberts. "Every time trend funds have begun to latch on to a market move this year, it has changed." The broadest index of European stocks gained around 10% from the start of the year to February 28 before falling by 20% over two weeks from March 25, a period that included Trump's April 2 Liberation Day tariff announcement. U.S. stocks trod a similar rocky path. The "worst" positions causing negative returns for trend funds included U.S. Treasuries, the Australian dollar, Japanese government bonds and in May, coffee, SocGen's report said. However, the dispersion between the two types of hedge funds has narrowed since April as markets swung back again. MACRO UP Discretionary macro hedge funds have achieved broadly positive returns over the first five months of the year. Rokos Capital Management, with $22 billion in assets, had returned 9.5%, according one source, with EDL Capital up 24%, according to a second. Brevan Howard's Alpha Strategies was up 4.32%, although its flagship fund is down 2.12%, said a third source. Macro traders in general have averaged an 8.5% annual return while managed futures traders, which include trend funds, have averaged a 7.2% annual return since PivotalPath began collecting data in 1998, with discretionary macro traders increasing that to an average of 9.6% since 2001. "Managed futures tend to be used in investor portfolios as a defensive allocation, which performs well when other strategies struggle," said PivotalPath's Roberts. Some large hedge funds have both macro and trend funds, which buffer each other. Man Group's systematic AHL Alpha Programme is down 10.6% for the year but its multi-strategy fund is up around 5.4%, according to the hedge fund's website. AQR Capital Management, which oversees $135 billion, posted a 10.6% return in its multi-strategy Apex fund to end-May. Bucking the trend, its Helix alternative trend strategy was also up, by 7%, although flat last month as it contended with reversals across interest rate swaps and yield curves. An almost 9% return in Graham Capital Management's Multi-Alpha Opportunity fund this year offset an 8.7% fall in its Tactical Trend fund, according to SocGen. Graham declined to comment on the results, but the founder of the $20 billion hedge fund, Ken Tropin, told Reuters that when trends "reverse violently", it "generally hasn't paid to overreact and deviate from trading models that have historically performed well in a variety of market cycles". In a note to clients, Adam Singleton, CIO of Solutions at Man Group, said May was a mixed month for discretionary macro strategies, adding that positions betting on a rise in stocks, the euro and the yen boosted performance while certain relative fixed income trades had hurt some. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Reuters
30-05-2025
- Business
- Reuters
HEDGE FLOW Hedge fund investors want managers who trade macro, says SocGen survey
LONDON, May 30 (Reuters) - Hedge funds that trade on big macroeconomic market swings have become a top pick for investors, according to a Societe Generale ( opens new tab survey of 322 firms, against a backdrop of global markets roiled by tariff uncertainty and stop-start trade wars. Half of the respondents polled said they would consider putting their money into discretionary global macro hedge funds in the next 12 months, the SocGen survey conducted between November 2024 and May 15 showed. The private survey was sent to investors on Wednesday and was seen by Reuters on Friday. The number of respondents expressing interest in putting money into macro hedge funds rose by around 9% compared with the bank's last survey in autumn 2024, the report said. According to hedge fund research firm PivotalPath, global discretionary macro managers, not using systematic trading to come up with trade ideas, posted a return of around 7% on investment through April in 2025, compared with a flat performance by the wider universe of hedge funds. Investor interest in equity market-neutral funds also grew roughly 10% since SocGen's autumn survey, the report showed. These hedge funds trade a balance of stocks, trying to maintain a portfolio which neither positions them long nor short stock markets as a whole. A short bet expects an asset value to decline. While global macro hedge funds taking discretionary bets often top this survey, the investors queried by SocGen expressed their highest enthusiasm for the strategy in two years, the bank data showed. Crypto hedge funds garnered the least intent to invest from those surveyed, with just 6% of investors wishing to allocate to the strategy, the lowest proportion in two years. Interest in multi-strategy hedge funds ticked up, with roughly around a third of investors surveyed interested in systematic and fundamental multi-strategy funds, up 5% and 4% respectively since the same time last year. Multi-strategy hedge funds trade many different kinds of markets under one brand.
Reuters
06-03-2025
- Business
- Reuters
Investors seek to switch hedge funds, citing risk, performance and size, says IG Prime
LONDON, March 6 (Reuters) - Roughly a quarter of investors surveyed by IG Prime are looking to change which hedge funds invest their money, citing reasons including riskiness, poor performance and size, the prime brokerage firm said in a report on Thursday. Volatility in financial markets helped the performance of global hedge funds in 2024, lifting returns to an average of roughly 11% for the year, according to hedge fund research firm PivotalPath. So far in 2025, hedge funds have returned 1.3% in the year-to-date as of end-February, said PivotalPath. While 76% of the 51 institutional clients surveyed by IG Prime said they would keep their hedge funds, 24% said they would switch, the prime broker's 'The State of the Hedge Fund Industry' showed. Investors that wanted to move cited unhappiness over poor performance and concerns about how their hedge funds handled risk management, the report said. These investors also worried about size. Two fifths said they would look for a smaller hedge fund manager while a quarter said they would switch to a bigger but more capable one. Most said they were interested in hedge funds which trade stocks. Over a third said they preferred multi-strategy hedge funds, which have many different trading strategies under one roof. Only 8% have interest in commodity funds and those which trade derivatives based on market bumpiness, or volatility, said the report. here.
