Apr 10, 2020 - Economy & Business

Hedge funds outperformed the stock market in March

Dion Rabouin, author of Markets
Reproduced from eVestment; Chart: Axios Visuals

Hedge funds outperformed the S&P 500 in March and have suffered fewer losses this year, showing their value during crisis periods, data from eVestment shows.

The state of play: March’s average loss was the second largest on record and largest since the height of the global financial crisis in October 2008 when the average fund lost 8%-9%.

The big picture: Hedge fund returns were highly differentiated and the 10 largest funds again managed to outperform the aggregate.

Of note: Managed futures strategies have been the shining star of the asset management world in 2020 after poor performance and outflows since 2016.

  • Managed futures strategies were "the only primary strategy with positive average returns in March and had by far the best proportion of products able to produce gains, with 53% of managers positive in March," Peter Laurelli, eVestment's global head of research, writes in a note.

What it means: Managed futures strategies are funds that can invest in many different asset classes and focus on systematic trends within assets, typically using derivatives and leverage.

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