Macro strategies, which bet on various political outcomes across the globe, pulled in $6.87 billion during January, nearly compensating for the $7.17 billion in outflows during the fourth quarter of 2017. Macro was one of the best performing strategies during January, gaining 3.53 percent, according to eVestment. That compares with a gain of 4.17 percent for all of last year.
Directional credit, which encompasses bets on various fixed income securities with the aim of outperforming, took in $3.62 billion of investor money after outflows in the fourth quarter. But the strategy was the worst-performing in January among the 14 tracked by eVestment. Hedge funds using directional credit as their primary strategy gained only 0.56 percent, compared with a gain of 5.29 percent in 2017.
Long/short equity funds have consistently taken in investor money since 2016, with $4.16 billion coming in the door in January. These hedge funds, which bet on some stocks to gain and others to fall, returned 2.71 percent during January after a 12.07 percent gain in 2017, according to eVestment. Still, that figure represented about half the gain generated by the S&P 500.
Only two strategies saw investor money outflows in January (compared with only three experiencing inflows during the fourth quarter of 2017). These included event-driven and multi-strategy. Each returned more than 2 percent during the fourth quarter.
Despite the strong flow of investor money into the industry for the first month of the year, a swath of hedge funds were burnished by some of the volatility during the beginning of January. Performance figures for the month should start to trickle out over the course of the week.