In July, Millennium Management Fund declined by 2.1%, narrowing its year-to-date return to 8.2%; North Rock also fell by 2.1%; LMR posted a smaller decline of 0.48%. The equity portfolios were primarily dragged down by losses in the AI and semiconductor sectors. In contrast, quantitative strategies performed strongly, with Quantedge gaining 7.8% for the month and achieving a year-to-date cumulative gain of 34.6%. The macro fund Pharo Macro rose modestly by 0.23%.
Sharp volatility in artificial intelligence (AI) stocks led to pronounced performance divergence across the hedge fund industry in July, with multi-strategy giants suffering losses while quantitative funds gained ground.
On August 3, according to people familiar with the matter cited by Bloomberg, Millennium Management’s net asset value declined by 2.1% in July, reducing its year-to-date return to 8.2%.
North Rock, a multi-manager equity fund, also fell by 2.1% during the same period, narrowing its year-to-date gain to 4.8%; the multi-strategy fund LMR posted a relatively modest decline of 0.48%, maintaining a positive year-to-date return of 6%.
Declines in the AI and semiconductor sectors were the primary drag on equity portfolios. Notably, Situational Awareness Fund was forced to sell most of its public market equity positions to Citadel under margin call pressure, partially offsetting prior losses in the sector.
Quantitative strategies lead amid market turmoil
In contrast, systematic cross-asset trading strategies demonstrated notable resilience.
Quantedge, which manages $7.2 billion in assets, rose 7.8% in July, lifting its year-to-date gain to 34.6%—a standout performance in the current market environment.
The macro fund Pharo Macro posted a modest gain of 0.23% over the same period, bringing its year-to-date return to 9.9%.
Beyond equity market volatility, the interplay between commodities and fixed income markets also formed a key backdrop in July.
Rapidly rising oil prices fueled concerns about inflation outlooks, pushing up yields on 30-year U.S. Treasury bonds, pressuring fixed income assets, and challenging the overall allocation of cross-asset portfolios.
Editor/Liam