Hedge funds worldwide gained 1.1% in July, driven by event-driven managers and fundamental equity long/short funds, according to Goldman Sachs Prime Desk.
Event-driven strategies saw the strongest performance, climbing 1.8% last month as increased merger arbitrage activity boosted returns. Fundamental equity long/short funds closely followed with a 1.6% gain. Despite these advances, both strategy types lagged behind the S&P 500, which rose 2.2% over the same period.
Quantitative strategies faced continued headwinds, posting losses for a second consecutive month. Short-term U.S.-focused trades, such as statistical arbitrage, weighed heavily on performance, while slower-moving, factor-driven strategies fared comparatively better.
The difficulties for quantitative managers were further intensified by momentum reversals and rallies in heavily shorted U.S. equities. Goldman Sachs Prime Desk highlighted that their model showed quantitative managers endured “one of their worst drawdowns per our records in July before a rebound at month-end.”
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.