Hedge fund hirings slowed, but performance showed improvement

Asset owners' direct investments in hedge funds totaled $1.7 billion last year, down from 2021's $5.9 billion, according to data collected by Pensions & Investments. There has been $70 million in hiring activity this year.

Looking at the four broad HFRI indexes, all had positive returns in January. The HFRI Equity Hedge Total index led the way with a 4.2% return after losing 10.1% in 2022.

Diving deeper into equity hedge strategies, the HFRI Equity Hedge Fundamental Value and HFRI Equity Hedge Multi-Strategy indexes had the best monthly performance (excluding individual sector subindexes), returning 5.1% and 5%, respectively. The HFRI Equity Hedge Fundamental Growth index wasn't too far behind with a 4.7% return.

The HFRI Equity Hedge Equity Market Neutral index lost 0.1% in January.

Fundamental growth, fundamental value, multistrategy, and quantitative directional had negative returns in 2022. The equity market neutral strategy returned 1.2%.