The firm said that these funds, which seek to profit from broad moves in economic events – as shown by currencies, interest rates and other entities – chalked up the largest gains during a volatile October. Other strategies overall had a more challenging month.
Macro hedge funds, which try to profit from broad market swings
caused by political or economic events, created standout gains
during the volatile month of October amid heightened geopolitical
risks and interest rate nerves, figures show.
The HFRI Macro (Asset Weighted) Index, produced by
Chicago-headquartered Hedge Fund
Research, rose by 0.7 per cent in October, the third
consecutive month of positive performance, bringing the trailing
three-month return to 4.2 per cent.
Overall, hedge funds posted mixed performance in October, as
equities traded in a wide range, interest rates continued to rise
on persistent inflation concerns, and geopolitical risks spiked
with the outbreak of conflict in Israel and Gaza.
The HFRI Asset Weighted Composite Index® (FWC) – essentially
unchanged for the month – declined 0.02 per cent. The HFRI Fund
Weighted Composite Index, which applies equal weights to all
constituent funds, declined 1.4 per cent for the month.
Fixed income-based, interest rate-sensitive strategies also
posted a narrow gain for October as interest rates rose. The HFRI
500 Relative Value Index rose 0.2 per cent. Relative value
arbitrage performance was led by volatility and sovereign bond
exposures.
Equity hedge funds, which invest long and short across
specialised sub-strategies, fell in October, with negative
contributions from technology and energy exposures. The HFRI
Equity Hedge Index (Asset Weighted) fell 0.7 per cent in
October.
Event-driven strategies, which often focus on out-of-favour, deep
value equity exposures and speculation on M&A situations,
also fell last month. The HFRI 500 Event Driven (Total) Index
fell 1.6 per cent for the month.