Hedge Fund Rollercoaster Continues with April Bonanza

After a challenging March which saw many hedge fund strategies wipe out year-to-date gains, indexation and analytics firm HFR says hedge funds returned to form in April with the HFRI Fund Weighted Composite Index achieving its seventh highest monthly return in history and the second highest since 2009.

Led by Equity Hedge and Event Driven strategies, the FWC rose 4.8% in April, a return only beaten in recent times by November 2020. This brings the year-to-date return back to +5.8% after a horror March in which it lost 3.3%. After March where only an estimated 30% of funds made money, in April this soared back to 85% of funds providing positive returns.

Although the April returns were less spectacular, Macro funds continue to perform well, although a 7.32% return for the Equity Hedge Index saw that measure rise to +6.79% on the year, just above Macro which sits at +6.69% after a 1.84% return in April. The Event Driven Index rose 5.22% after dipping into the red in March, it now sits at +4.75% year-to-date.

Within the Macro index, the Active Traders Index performed best at +3.48% in April, for +6.4% on the year, however it still lags year-to-date performance compared to systematic and trend following indices. The latter was +1.92% in April for +7.76% year-to-date, while systematic traders once again outperformed discretionary, with both the Systematic Diversified Index and Systematic Directional Index returning +2.33% in April, for +9.95% and +9.8% respectively year-to-date. The Discretionary Direction Index, meanwhile, was +1.7% for +4.99% year-to-date.

The HFR Cryptocurrency Index managed to rise in April, by 4.24%, however it remains mired in the red at -8.23% year-to-date. All six HFR Blockchain indices remain in the red for the year, indeed the Cryptocurrency Fundamental Index managed to fall in April, by 7.55% and now sits -25.88% on the year.

Performance dispersion expanded again in April, as the top decile of the HFRI FWC constituents advanced by an average of +18.4%, while the bottom decile fell by an average of -4.1%. This top/bottom dispersion of 22.5% for the month is up from 19.1% in March. For the trailing 12 months ending April 2026, the top decile of FWC constituents gained +90.6%, while the bottom decile declined -6.6%, for a top/bottom dispersion of 97.2%.

“Hedge funds delivered historic gains in April, fuelled by easing geopolitical fears, rebounding tech and AI momentum, Fed leadership clarity, and optimism around a record IPO cycle,” says Kenneth Heinz, president of HFR. “The sharp rebound marked a dramatic reversal from the risk-off sentiment in March, though managers remain tactically positioned amid expectations of renewed market disruptions and volatility.”