I’ve lost count of the praise heaped on US hedge funds for their “historic performance” in April on artificial intelligence-related bets and alleged foresight of a ceasefire in the Iran war. The fact that one month’s performance was so celebrated, particularly when hedge funds as a group generated less than half the return of the broad US stock market last month, shows how little investors have come to expect of them.
It wasn’t always like this. It’s hard to imagine so much pomp over a single month when hedgies reigned supreme in the 2000s, much the way technology entrepreneurs do today, or star mutual fund managers did in the 1980s. Investors begged hedge funds to take their money two decades ago; even the industry’s brightest lights are on bended knee these day for investment.