Bridgewater China Lost 2.8% in July but Still Posts 3% Positive Return Year-to-Date
Nashnova编辑部
Bridgewater's China fund lost 2.8% in July, yet remains up roughly 3% year-to-date; long-only quant funds averaged a 17% loss over the same month, turning macro resilience into the metric investors are now watching most closely.
How badly did Bridgewater China get hit in July?
Bridgewater China posted a 2.8% monthly loss (gross) in July, but still held roughly 3% positive returns year-to-date through July 31.
The fund manages over RMB 60 billion (about $8.9 billion).
This means → a fund of nearly $9 billion gave back less than three percentage points in a month when the CSI 300 fell 7.9% — less than half the benchmark's drawdown.
How did quant funds perform over the same period?
Long-only quant funds averaged a roughly 17% July loss — six times Bridgewater's drawdown.
Of nine products run by DeepSeek founder Liang Wenfeng's hedge fund, eight turned negative for the year.
Chinese hedge funds overall averaged a 7.3% July loss, nearly matching the CSI 300's decline.
In plain terms = quant funds rode the rally, swelling to RMB 2.6 trillion in assets, but one sharp sell-off clawed back most of those gains.
What kept Bridgewater standing?
Bridgewater China said in an investor letter that its All Weather Plus strategy — a portfolio approach that spreads capital across stocks, bonds, commodities, and other asset classes — "effectively cushioned the sharp volatility of any single asset class" in July.
Bonds delivered positive returns in July; some commodities rose on tensions around Iran, adding a further positive contribution.
This means → when equities fell, bonds and commodities acted as a backstop — exactly what risk parity (allocating risk evenly across asset classes instead of concentrating bets on equities) is designed to do.
What does Bridgewater China's longer-term track record look like?
The All Weather Plus strategy has delivered an annualized return of 26.3% since its July 2023 launch, with a maximum drawdown of 9.9%.
On the active side, the team generated 2.4% of alpha in Q2, offsetting a 0.5% loss in the systematic all-weather book, for a combined quarterly return of 2.3%.
In plain terms = the machine-driven sleeve lost a little; the human-judgment sleeve more than made up for it.
How did other macro funds fare?
Wengjin Asset Management, founded by Bridgewater alumna Zhang Emily Xinyi, lost 4.4% in July but remains up 12% for the year.
Hangzhou Bolierxiang's Xiaohongzhang fund lost just 1% in July, with a year-to-date return of 10.6%.
Across 309 macro hedge funds tracked by Shenzhen PaiPaiWang, the average July loss was 3.5%, with year-to-date returns still at 1.9% — the July drawdown was less than half the CSI 300's.
Xiaohongzhang manager Lin Yingying: "Defense isn't about avoiding losses entirely — it's about being in good enough shape to catch the next wave."
What does this divergence mean for investors?
Macro funds lost an average of 3.5% in July; quant funds lost 17% — same market, nearly five times the drawdown.
This reflects the fragility of quant funds in a one-directional sell-off: most of their models rely on historical statistical patterns, and when a sharp drop breaks those patterns, losses pile up fast.
This means → the July split between macro and quant performance is becoming a key reference point as investors reassess strategy allocation — "not losing too much" is itself a competitive edge.
Content is for reference only, not financial advice.