Hedge your bets: it pays
Covid-19 and other global crises have tested hedge fund strategies, writes Pedro van Gaalen
Periods of unprecedented market volatility make or break a hedge fund. With an abundance of shorting opportunities from Covid-19’s economic fallout and the Russia-Saudi Arabia oil price war, the right call would’ve insulated investor returns at a time when markets lost 30% on average.
Fund managers who didn’t deliver capital preservation on the downside and alpha during April’s bounce failed to fulfil the hedge fund’s raison d’être...