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The hedge funds have reduced their bets to the actions and reduced their borrowings from banks when they have trouble facing the high volatility of the market launched by the world’s trade war of US President Donald Trump.
A net market sale in recent weeks on the concerns about Trump’s prices has particularly struck the sector. The VIP index of the Goldman Sachs hedge industry, which follows the most popular purchases of funds such as the ads group APPLORVEChipmaker Broadcom and Energy Group Vistra, fell 12.5% since February 19 – when the S&P 500 reached a record – compared to an 8.6% drop in the blue chip index.
Consequently, hedge fund managers have aggressively reduced the size of their leverages when they try to limit losses, reducing the amount they borrow from banks to buy or bet against shares.
The reduction in raw positions – the combination of Paris on and Paris against actions – by the Hedge Funds on Friday and Monday was the largest in four years, according to a report by Goldman Sachs, and one of the largest in the past 15 years.
“There is a lot of pain there,” said a frame in a large hedge fund. “The only way to defend yourself in the environment today is to reduce your lever effect.”
Among the funds having been affected during the volatility of the market, there is the millennium of Izzy Englander, which manages nearly $ 75 billion in assets. He lost 1.4% last week to Thursday, according to a person who had seen the number, having already decreased by 0.8% this year until the end of February.
The Citadel of the Headroom Fund of Ken Griffin, which costs $ 66 billion in assets, fell 0.3% this year at the end of February, although Balyasny increased by 3.5% in its main fund.
The millennium and the citadel refused to comment.
Trump’s ON-OFF approach to prices on American trade partners has disrupted markets, while repression against immigration and public sector reductions have raised that inflation can increase and GDP growth could slow down.
The VIX, the so-called Wall Street gauge, which measures market expectations in stock fluctuations, has reached its highest level since August from last year.
Three people working in various multi -management designing funds – who use many traders’ teams, large quantities of leverage and close risk management – said that item reduction was the largest that they had seen since at least at the end of 2018, when the markets were sold sharply.
The rapid reductions in the leverage of hedge funds by multi-managers can lead to one more drop than they would otherwise, “amplify market movements,” said the governor of the Bank of England, Andrew Bailey last month.
Hell fund managers claim that the current environment has led to a more volatile market in which it is more difficult to choose actions that will do well or bad in the short term.
“”[There has been a] The paradigm shift that means that different actions will lead, the evaluation premiums change, “said a multi-manager coverage framework.
The most popular short -term short -term index actions of Goldman Sachs began to go beyond the most popular long positions, causing losses to managers.
The fundamental property funds of the short short short has lost an average of almost 6% since February 18, according to data from Goldman Sachs seen by the FT. On a 14 -day rolling basis, which marks the largest peer -peer loss of the funds since May 2022.
“These policy changes have been massive and rapid,” said a framework. “It’s a different environment now. We have never seen that.
