Hedge funds barely recover war losses, with a hidden current of pressure to buy the dip

At the beginning of this year, hedge funds overall performed quite brightly. According to data from hedge fund research institutions, on the eve of the outbreak of the Middle East conflict, macro and CTA funds had already increased by 5% year-to-date, with the average global fund also seeing a rise of 2.5%. However, after the war broke out, risk preferences contracted sharply, with the macro and CTA index retreating by about 4 percentage points in a single month, and the average global fund return temporarily falling into negative territory.

Currently, most fund styles have essentially recouped their losses. Macro funds, hedge equity funds, and global fund averages have all rebounded above pre-war highs, again becoming the strategy with the highest year-to-date returns among various funds. However, without the interference of this war, they were originally expected to achieve better results.

On the other end, absolute return, equity market-neutral, and multi-strategy funds were already struggling pre-war and continued to falter post-war, failing to rebound effectively to this day. White pointed out that most funds are still behind the expected track at the beginning of the year, which puts fund managers under greater pressure to catch up - in the current risk rebound market, they might be more trigger-happy than usual.