And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward - and free. We believe everyone should be able to make financial decisions with confidence. Our estimates are based on past market performance, and past performance is not a guarantee of future performance. Examples are hypothetical, and we encourage you to seek personalized advice from qualified professionals regarding specific investment issues. NerdWallet does not and cannot guarantee the accuracy or applicability of any information in regard to your individual circumstances. They are not intended to provide investment advice. Its articles, interactive tools and other content are provided to you for free, as self-help tools and for informational purposes only. is an independent publisher and comparison service, not an investment advisor. 'For people who invest in CTAs, they tend to understand if you have sharp reversals, they are not going to do well staying with them,' said Steinbrugge.NerdWallet, Inc.

Macro funds which lost money might face investor redemptions, said Don Steinbrugge, founder and chief executive of Agecroft Partners. He does not plan to reduce his investment in trend funds because he believes trend-following strategies will work over the year. Trend-following funds tend to bail quickly on trades that stop working, said a pension fund director who invests in hedge funds. The bank decided not to change clients' borrowing limits, but it has increased diligence oversight on the hedge fund exposure, including new clients, the broker said. Funds exited numerous trades, including hedges that failed to shield investors from market volatility, according to a prime broker at a large bank. “The violent swings in the global rates markets took their toll on many discretionary and systematic (CTAs) managers,' said Neumann, adding portfolio managers on average cut risk exposure by 50% following the selloff.ĬTAs cut their entire long exposure of roughly $60 billion in equities in two weeks and are also cutting credit exposure, UBS said in a note to clients. The blowup in banks caused investors to flee to the safety of bonds, sending yields down at a rate not recorded since the 2008 financial crisis. Jim Neumann, chief investment officer of alternatives advisory firm Sussex Partners, said many funds were caught off guard in short positions in sovereign debt markets. Progressive said losses sustained by its Tulip Trend fund stemmed from fast moves in interest-rate markets. Systematica and Man Group declined to comment. Progressive Capital Partners, Systematica, and Man Group (EMG.L) had funds which posted losses of 19.8%, 13.1% and 7.6% in March, respectively, said HSBC. Trend-following hedge funds, which trade on systematically programmed ideas, also posted big losses. Rokos declined to comment it told investors last week it decided to cut risk after the hit. London-based Rokos Capital Management was down 12% on the year through March 24 due to market losses, said a source familiar with the matter. 'There is a lot of pain out there and the other big question we must ask ourselves is how much of the fast money has been unwound,' de Langlade wrote. DG Partners declined to comment.Įdouard de Langlade, founder and owner of EDL Capital, said in a letter last week that he believed the move in rates was caused by CTAs unwinding positions because of risk-control purposes. EDL said it had recouped March losses and was positive for the year but did not add further details. HSBC Research showed EDL Capital lost 6.4% in March while DG Partners lost 8.1% this month through March 28. Hedge fund strategies based around macroeconomic ideas like those run by Rokos, DG Parters and EDL Capital fund posted negative performances in March, sources and bank data said. Those funds are down 2.7% and 6% for the year through March 29, respectively. Macro and trend-following hedge funds dropped 3.2% this month through March 29, while algorithmic commodity trading advisor funds (CTAs) dove 6.8%. banks and Swiss lender Credit Suisse rocked stock, bond and currency markets, catching many hedge funds off-guard and leaving them with unexpected losses.

The sudden collapse this month of two regional U.S. LONDON/NEW YORK/HONG KONG, March 31 (Reuters) - March's market turmoil has forced many macro and trend-following hedge funds to cut bait on bad portfolio bets and caused at least one bank that lends to them to scrutinize its clients' exposure, according to sources and preliminary data reviewed by Reuters.