Confidence levels reported by hedge funds remain upbeat despite continued economic and geo-political headwinds impacting the global economy, including the war in the Ukraine, consumer price inflation being at a 40-year high, and subsequent tightening of monetary policy, says the ‘AIMA Hedge Fund Confidence Index Q2.’ On a performance measure, hedge fund returns continue to be mixed, it says. While some fund strategies have experienced a challenging start to the year, others have thrived with performance dispersion across the industry becoming even more pronounced. Upon closer examination of the hedge fund strategies, CTA and global macro reported the highest confidence scores. In comparison, crypto hedge funds scored the lowest on confidence, not too surprising, given the difficult conditions being reported across the asset class this year. Despite challenges and the threat of more still to come, hedge fund managers globally remain cautiously optimistic about their economic prospects for the coming 12 months, it says. In the wake of global financial markets experiencing sharp corrections and higher expected volatility, hedge funds are reinforcing their value proposition in best managing downside risk and offering financial security to investors.
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