Pivotal Point of View – January 2025

For allocators evaluating hedge fund performance, context matters.

 Pivotal Points: 

Pivotal Point In Time: December tested the mettle of equity players, while macro managers shined 

• Hedge funds rode December’s volatility well, with the PivotalPath Hedge Fund Composite Index up 0.3% across the month.
  • The sector’s flat month compares favorably with major markets, which were hit hard after November’s ‘Trump Rip’ turned into a ‘Trump Dip’. The S&P 500 was down 2.38% versus the PivotalPath Equity Diversified Index’s flat 0.5%.
  • The month also saw significant regional dispersion, and, in a reversal of November’s trend, US market players fared less well than EMEA and APAC focused funds.
  • The PivotalPath Equity Diversified: US Long/Short Index was down 1.5% in December, versus the PivotalPath Equity Diversified: Asia Long/Short Index’s 2.1% and the PivotalPath Equity Diversified: Europe Long/Short’s 1.0%.

• While equity specialists seesawed in December, macro managers made hay with the potential dawn of an era promising more currency volatility and a lack of central bank alignment.
  • The PivotalPath Global Macro Index was up 1.6% for December, compounding November’s returns of 1.5%. Macro players, who have experienced a challenging year, ended 2024 strongly, with a YTD of 6.2%. Members of the macro cohort with a decent equity component did significantly better than this, often exceeding double digits across the year.