Hedge funds recorded their strongest monthly performance in more than four years in April, as a powerful rebound in technology stocks drove broad-based gains across strategies and lifted industry returns to levels last seen during the post-pandemic recovery period in 2020, according to a report by the Financial Times.
A global hedge fund index compiled by HFR rose approximately 5% over the month, marking its best performance since November 2020, according to preliminary estimates. The advance was led by technology-focused managers, which surged around 14% as mega-cap and semiconductor equities rallied sharply.
The gains came amid a broader equity market surge, with the S&P 500 rising more than 10% – its strongest monthly performance since the November 2020 vaccine-driven rally – while the Nasdaq Composite climbed over 15%, reflecting outsized strength in growth and technology names.
A key driver of performance was the sharp appreciation in large-cap tech and semiconductor stocks. Alphabet, Intel, and AMD were among the standout contributors, with Alphabet rising roughly one-third over the month and chipmakers posting even steeper gains, including Intel more than doubling and AMD advancing more than 70%. Memory-focused names also saw significant upward moves, reinforcing the scale of the sector rotation.
Industry participants noted that strong corporate earnings, continued capital expenditure from major cloud and technology “hyperscalers,” and speculative momentum in semiconductor supply chains all contributed to the rally. Allocators reported that diversified hedge fund portfolios experienced some of their strongest monthly returns in over a decade.
Prime brokerage data from Goldman Sachs indicated that hedge funds increased net leverage during the month, with managers adding to long equity exposure amid the market rebound. The shift reflected a broad risk-on stance across discretionary and systematic strategies.
Multi-strategy platforms and large diversified managers also posted solid gains. Citadel, Millennium, and other multi-manager firms reported positive performance for April, benefiting from both directional equity exposure and relative value trading opportunities. Meanwhile, long-short equity funds such as Marshall Wace’s Eureka strategy delivered mid-to-high single digit returns, underscoring strength across active equity books.
Performance was notably stronger than March, when many funds were caught on the wrong side of rapidly shifting macro expectations, including volatility in rates and currency positioning. The April rebound was partly attributed to more stable market conditions, which reduced forced deleveraging and allowed higher-conviction positioning to play out.
Volatility, as measured by the VIX, declined over the month, creating a more supportive environment for leveraged equity strategies. Lower volatility helped reduce risk constraints for multi-manager platforms and enabled capital deployment into high-beta technology exposures.
Macro hedge funds also recovered after March losses, although performance remained more modest relative to equity-focused peers, reflecting continued dispersion across strategy types.
