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EVENT-DRIVEN LEADS HFRI PERFORMANCE AS M&A, IPOs ACCELERATE
Macro also gains on quantitative, trend-following CTA’s; Special Situations, Activists surge on earnings, M&A & IPOs 
CHICAGO, (May 7, 2019) – Hedge funds extended gains from the strongest 1Q since 2006 in April, with gains across all main strategies led by Event-Driven and Macro. The HFRI Fund Weighted Composite Index® advanced +1.6 percent for the month, bringing the YTD return to +7.2 percent, as reported today by HFR®, the established global leader in the indexation, analysis and research of the global hedge fund industry. The HFRI Asset Weighted Composite Index advanced +1.7 percent for the month. 
Risk Parity and Bank Systematic Risk Premia also gained for the month, led by the HFR BSRP Credit Index, which surged +5.9 percent in April, bringing the YTD return to +12.6 percent. Risk Parity strategies added to strong 1Q gains with the HFR Risk Parity Vol 15 Index advancing +1.0 percent in April, increasing the YTD return to +16.5 percent. BSRP sub-strategies also surged for the month, with the HFR BSRP Credit Momentum vaulting +10.1 percent and the HFR BSRP Currency Multi-Style Index jumping +8.4 percent. 
Event-Driven led HFRI strategy performance for the month as corporate earnings continued to be strong with core positions in Apple, Microsoft, Google and Facebook driving gains. Managers were also active in Lyft, Pinterest and Beyond Meat while anticipating the Uber IPO. The HFRI Event-Driven (Total) Index gained +2.2 percent, bringing YTD performance to +6.4 percent. ED sub-strategy performance was led by the HFRI ED: Special Situations Index, which surged +3.7 percent for the month, leading all sub-strategies and bringing YTD performance to +9.2 percent. The HFRI ED: Activist Index posted a similar gain of +3.0 percent in April, as Activist funds lead ED sub-strategy performance YTD with a return of +12.3 percent. Similarly, the HFRI ED: Distressed Index added +3.0 percent in April, increasing the YTD return to +6.4 percent. 
Macro also posted strong gains across both fundamental as well as quantitative, trend-following CTA strategies, with the HFRI Macro (Total) Index gaining +1.7 percent for the month. Systematic Macro strategies advanced in April, with the HFRI Macro: Systematic Diversified Index advanced +2.5 percent in April, following a +2.9 percent return in March, and bringing YTD performance to +4.6 percent, leading all Macro sub-strategies for 2019. Similarly, defensive, Fundamental Discretionary Macro strategies also advanced in April, with the HFRI Macro: Discretionary Thematic Index added +2.3 percent for the month, increasing YTD performance to +4.4 percent. Volatile cryptocurrency exposures also surged in April, as the HFR Blockchain Index vaulted +12.7 percent, bringing its YTD return to +25.8 percent. The HFRI Macro Asset Weighted Index gained +1.9 percent for the month. 
Equity Hedge extended strong 1Q returns on corporate earnings and expectations for the continuation of active M&A and IPO issuance trends. The HFRI Equity Hedge (Total) Index gained +1.6 percent for the month, bringing YTD performance to +9.5 percent for the industry’s largest strategy area of investor capital. The HFRI EH: Technology Index led EH sub-strategy performance for the month, jumping +3.0 percent. The HFRI EH: Fundamental Value also added +2.5 percent in April and leads EH sub-strategy performance YTD with a return of +11.7 percent. The HFRI Emerging Markets (Total) Index advanced +1.0 percent for the month, led by Russia/Eastern Europe and MENA exposures. Partially offsetting these gains, the HFRI EH: Healthcare Index declined -2.6 percent for the month, paring the YTD return to +10.2 percent. 
Fixed income-based Relative Value Arbitrage and Credit Multi-strategies also advanced in April as credit gained, led by exposure to Yield Alternatives. The HFRI Relative Value (Total) Index added +0.9 percent for the month, bringing YTD performance to +4.9 percent. Yield Alternatives led RVA sub-strategy performance for both April and YTD, gaining +1.7 and +13.1 percent, respectively, over the periods. 
“Hedge funds extended strong 1Q gains on acceleration of powerful risk-on sentiment, though the drivers of performance evolved and expanded from technology-centric equity beta to include credit, M&A, commodity and currency exposures. Performance drivers were also distributed across a broad range of strategies, including Special Situations, Activist, as well as Macro Discretionary and Systematic strategies,” stated Kenneth J. Heinz, President of HFR. “These evolving drivers of performance, in combination with favorable trends in US economy and employment, as well as receding European macroeconomic risks, have contributed to attractive near-term opportunities for long-short exposures across a wide range of asset classes. It is likely that funds tactically positioned for these trends will drive industry performance and growth through mid-2019.” 
Comments reference Flash Update performance figures as posted on May 7, 2019.