Global Hedge Funds Report Mixed September Results Amid Rate Hikes

Global hedge funds reported mixed performance for September 2026, influenced by rising bond yields, higher oil prices, and volatility in AI-related shares. The United States Federal Reserve raised interest rates for the first time since 2023, a move that pushed US Treasury yields to two-decade highs and increased financing costs for fund managers.

Performance diverged sharply by strategy. Computer-driven systematic equity long-short funds achieved their best monthly performance of the year with a 3.46% gain. Conversely, fundamental equity long-short funds averaged a 0.55% loss, though they still outperformed the MSCI World Index, which declined 1.3%.

Macro funds and trend-following strategies capitalized on the volatility. Bridgewater Associates' Pure Alpha fund returned 18.4% in the first nine months of the year, while other firms saw gains from long energy and short fixed-income positions. In the United States, funds were net sellers across most sectors, though software and semiconductor equipment attracted inflows. Asian hedge funds underperformed the global average, falling 0.6% through September 25 due to economic uncertainty and swings in technology positions.