Multi-strategy hedge funds end October with gains -sources

by | Nov 6, 2023 | Economy

By Carolina Mandl

NEW YORK (Reuters) -Many of the world’s biggest multi-strategy hedge funds crossed the finishing line of a challenging October for markets with gains, sources familiar with the matter told Reuters.

Multi-strategy hedge funds have an advantage in difficult times for markets, because they trade many different assets from equities to currencies and credit and in multiple different strategies.

The Citadel flagship hedge fund Wellington ended October up 1%, and Point72 gained 1.2%, while Millennium rose 0.6%, Schonfeld Fundamental Equity gained 1.15%, and ExodusPoint advanced 0.69%, according to the sources.

The funds’ performances year-to-date, however, are more mixed, though still positive. Citadel’s flagship soared 13.7% in the first 10 months of the year, and Millennium and Point72 gained 8.3% each. ExodusPoint and Schonfeld rose 5.39% and 2.1%, respectively.

Portfolio managers were caught with wild swings in markets in October.

U.S. Treasury yields, which move inversely to prices, surged in October, with benchmark 10-year yields hitting 5% for the first time since 2007. The bond sell-off, which has taken Treasuries to the cusp of an unprecedented third straight year of losses, was caused by concerns that interest rates will remain high for long due to a surprisingly strong economy, and also reflected rising investor concerns over increases in government bond supply.

In equities, all major Wall Street indexes ended October down, with the S&P 500 falling 2.2% and the Nasdaq Composite down 2.8%. Both indexes posted a third straight month of losses.

(Reporting by Carolina Mandl, in New York; additional reporting by Davide Barbuscia; editing by Jonathan Oatis)

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