Hedge funds trading bonds and currencies are on track for their best year since the global financial crisis, boosted by the steep interest rate rises that have inflicted heavy losses on equity specialists and mainstream investors.
So-called macro hedge funds, made famous by the likes of George Soros and Louis Bacon, endured a barren period when markets were becalmed by trillions of dollars of central bank bond buying after 2008. But this year they have thrived thanks to seismic moves in global bond markets and a bull run in the dollar as the US Federal Reserve and other central banks battle soaring inflation.
Among the winners have been billionaire trader Chris Rokos, who recovered from losses last year to gain 45.5 per cent in 2022, helped by bets on rising interest rates, including during the UK’s market turmoil in the autumn. It leaves the Brevan Howard co-founder on track for his best year since launching his own fund, now one of the world’s biggest macro funds with about $15.5bn in assets, in 2015.