Seizing the ceasefire rally, technology-focused stock selection funds recorded a nearly 19% monthly return, setting a historical record.
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Against the backdrop of a strong rebound in the US stock market in April, various hedge fund strategies generally recorded positive returns, with some indicators hitting historic highs. The timing and speed of decisions regarding ceasefire were key factors.
The US-Iran ceasefire agreement became the core catalyst for hedge fund performance in April. Reports from several large investment banks and industry analysis institutions show that some funds had already established long positions before the ceasefire news was announced on April 8, thereby achieving considerable profits.
According to a report sent to clients by Goldman Sachs, stock-picking hedge funds saw returns of over 9% in April, marking the best single-month performance since the bank began tracking this data in 2016. Stock-picking funds focused on technology performed even better, with monthly returns close to 19%, also setting a new record.
PivotalPath, a hedge fund data company, pointed out in its report that funds able to quickly adjust positions markedly outperformed in this round of market activity, with response speed a key variable separating winners from losers. Large multi-strategy funds such as Schonfeld Strategic Advisors, Citadel, and ExodusPoint all closed out with positive returns.
According to a report from Morgan Stanley, at the end of April, funds were generally net sellers of stocks, aiming to adjust the long-short balance of their overall portfolios.
Both Stock-Picking and Systematic Strategies Benefited; Reduction at Month-End
According to Goldman Sachs, hedge funds’ sources of returns in April followed two main lines: one was systematic returns from market gains, and the other was individual stock trading returns that were relatively independent of overall market trends.
Systematic hedge funds saw returns of about 2.9% in April, with primary profits coming from momentum trading and participating in crowded trades, rather than contrarian bets.
Technology-focused stock-picking funds’ nearly 19% monthly return was especially notable, making it the standout strategy in the industry.
According to Morgan Stanley, at the end of the month, funds were generally net sellers of stocks to adjust the long-short balance of their portfolios.
Judgment of Ceasefire Timing and Decision Speed Are Key
According to PivotalPath, the core advantage of multi-strategy funds in this round was decision efficiency.
During the pressured market conditions in March, these funds suffered certain difficulties, but entering April, faster decision-making mechanisms helped them quickly rebuild positions, focusing on individual stocks and relative value trades, ultimately achieving a monthly turnaround.
The report specifically named Schonfeld Strategic Advisors, Citadel, and ExodusPoint, all of which ended April with positive returns, demonstrating the adaptive advantage of the multi-strategy framework in fast-changing market environments.
For macro strategy funds, April presented a clear "fire and ice" split. PivotalPath defined April as a "two-stage market," with the key dividing line being the timing of judgment regarding oil price shocks and geopolitical developments.
"Those managers who were early to downplay the impact of oil price shocks and proactively position for cooling geopolitical situations achieved substantial returns," the PivotalPath report stated.
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