For allocators evaluating hedge fund performance, context matters.
Pivotal Point In Time:
A tariff U-turn sparked life back into the markets at month end, but many strategies still struggled to get on top of April’s wild swings.
- April’s close marked 100 days of a new US administration. And a period most visibly embodied by 14 distinct tariffs, applied to 180 countries, and with potentially 1000s of consequences.
- The see-sawing of trade policy made the month one of stark contrasts. At April’s beginning, ‘Liberation Day’ created a renewed wave of volatility that enhanced March’s pain as managers continued to peg back net and gross levels…
- …While at month end a series of policy U-turns on the steepest tariffs, a decent labor market, and largely solid fundamentals reignited a degree of market confidence.
- Over the month the performance of the PivotalPath Composite Index stayed flat at 0.1% and 0.1% for the year, as the wider community of funds felt some pain but handled the volatility well.
- Overall fund performance continued to best major indices YTD, with the Nasdaq (9.65%), Russell 2000 (11.93%), S&P 500 (4.92%), Dow Jones Industrial Average (4.41%) and MSCI World (0.89%), all depressed across 2025.
- Volatility funds were last month’s strongest performers – the PivotalPath Volatility Trading Index was up 4.5% across the month and 6.6% for the year, as a whipsawing VIX and spikes in real and implied volatility drove performance.
- As Vol managers took advantage of uncertainty, managed futures funds continued to be hurt by the unpredictable moves in bonds, equities and the USD. The PivotalPath Managed Futures Index was down 4.6% for the month, taking it to 8.2% YTD.
- One of the early winners of 2025 was also holed by April’s unpredictable swings. The PivotalPath Global Macro Index fell by 1.1%, taking its YTD to 1.9%. Over April the global macro cohort saw significant dispersion, with the month’s strugglers generally hit by an erratic USD in April, as well as losses in fixed-income and global currency trades.
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