Macro hedge funds have been paring back risk exposure amid renewed market volatility, but remain net long equities, according to a report by Investing.com citing recent analysis by Barclays’ prime brokerage unit.
The report highlights that managers have reduced leverage and de-risked portfolios in response to choppy macro conditions — including softening energy prices, mixed inflation signals, and political uncertainty in the US — yet have stopped short of a full retreat from risk assets.
Barclays said equity exposure remains positive across most discretionary and systematic macro strategies, reflecting continued confidence in the resilience of US growth and expectations of a potential resolution to fiscal and trade tensions later this quarter.
The move follows a period of heightened cross-asset volatility and shifting rate expectations, which prompted many managers to rotate out of cyclical trades and tighten stop-loss limits. Still, hedge funds appear unwilling to abandon their bullish bias in equities, particularly in technology and financials, which have led recent gains on Wall Street.
Oil prices, meanwhile, have stabilised near five-month lows as supply concerns ease, adding further complexity to macro positioning.
While hedge funds are cautious heading into a heavy corporate earnings season, Barclays noted that most remain tactically long into year-end — positioning for a rebound in risk sentiment once political and policy headwinds clear.
