The author is editoratlarge for finance and markets at Reuters News. Any views expressed here are his own
LONDON, April 23 Reuters For all the bad press, muchmaligned hedge funds have had their best start to the year in decades, while mixed stock and bond funds flattered to deceive and even macro hedge funds are back in vogue.
Highprofile battles between short sellers and online day traders over Gamestop, as well as the Archegos and Greensill debacles, made 2021 appear to be a nightmare for the industry.
But data from Hedge Fund Research HFR this week showed a wild few months for corporate events, cryptocurrencies and the macroeconomy saw hedge fund assets overall jump 201 billion in Q1 to top 3.8 trillion by March.
While average gains of 6 across all strategies during the quarter seem modest against 5.8 gains in the Wall Sts main SP500 index, it masks 78 average gains in eventdriven funds, dealing in the likes of mergers and acquisitions, and a stonking 120 performanced in cryptocurrency funds.
Uncorrelated macro hedge funds focused on currencies, commodities and interest rates, whose performance has suffered during many years of low economic volatility and near zero interest rates and inflation, also drew a torrent of inflows.
HFR said total capital in Macro rose by 14.4 billion to 618 billion, with an estimated 875 million of net new investment during the quarter. Not quite the glory days of the 1990s, but something is changing.
With inflation risk high on the…