Hedge Fund Performance in March: A Tale of Winners and Losers — Evening Brief – 04.23.25 

Hedge funds faced a challenging March, with the industry narrowly clinging to positive returns for the year. Despite widespread losses triggered by the administration’s tariff policies and a sharp tech sell-off, standout performances from quantitative equity managers and global macro funds provided a silver lining, according to PivotalPath. 

PivotalPath’s Composite index, which tracks over 3,000 hedge funds managing more than $3 trillion, dropped 1% in March, leaving it just 0.2% positive year-to-date (YTD). The month revealed stark performance dispersion: 40% of funds posted gains, averaging 1.82%. The remaining 60% saw losses averaging 3.79%. For the first quarter, 54% of hedge funds generated gains with an average return of 3.97%, while declining funds lost an average of 5.57%. This split highlights the critical role of strategy selection in volatile markets. 

Quantitative equity managers thrived amid the chaos in the first quarter, up 4.3%, including a 1.5% gain in March. These funds delivered 10.2% alpha over the S&P 500 on a rolling 12-month basis, topping PivotalPath’s alpha leaderboard. AQR Management’s Apex fund soared, gaining 9% in the first quarter. 

Global macro managers also shone, up 2.8% in the first quarter and up 1% in March. Managers delivered 5.1% alpha relative to the S&P 500, capitalizing on macroeconomic shifts. Volatility-focused strategies also proved their mettle. The PivotalPath Volatility Trading Index rose 0.9% in March and 2% YTD, a strong showing as the VIX spiked nearly 30% in the first quarter. 

Multi-strategy hedge funds, meanwhile, faced headwinds but remained afloat. Funds were down 0.8% in March, but up 0.5% YTD. Notable losses included Millennium and Citadel, which posted declines of 2% and 0.85%, respectively, in the first quarter. 

Equity sector funds bore the brunt of the sell-off, down 4.3% in March and nearly 5% in the quarter. U.S.-focused long/short funds fell 3.4%, European funds lost 1.8%, while Asian funds gained 1.1%. 

Healthcare Fund dropped 5% in March, hit by U.S. FDA changes and biotech funding concerns. Rhenman & Partners’ healthcare fund lost over 11%. TMT Funds collapsed 5.4%, reeling from tariff threats to tech supply chains and earnings. 

CTAs and managed futures strategies lost 0.9% in March, with Q1 losses at 3.6%. Man Group’s AHL Diversified and AHL Alpha programs fell over 15% and 9.35%, respectively, year-to-date. Event-driven funds dropped nearly 3% in March, bringing year-to-date losses to 1.4%, as anticipated M&A activity under Trump waned. 

PivotalPath monitors over 3,000 hedge funds managing more than $3 trillion in assets, representing $450 billion in client capital.