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Hedge funds posted negative performance in May, accentuating their losses this year to almost 3%, as investors positioned for a potential recession, a report by hedge fund data provider HFR showed on Tuesday.

The fund weighted composite index went down 0.58% in May, amid volatility in equities, bonds and commodities, HFR said, with all funds categories in the negative territory. Still, 40% of the hedge funds compiled posted gains.

Equity hedge funds posted a loss of 8% in the first five months of the year, the worst performance among hedge fund categories monitored by HFR. Still, they outperformed the S&P 500, which was down 12.76%.

Hedge funds that invest in growth-oriented sectors, such as technology and healthcare, have struggled this year. Tiger Global, one of the industry’s biggest firms, lost 14% in May, leaving it down 52% for the year, for instance.

“Hedge fund outperformance of U.S. equities continued in and through the extreme financial market volatility in May, with managers navigating not only the continuation of the Russia/Ukraine war, record energy price increases, generational inflation and increasing interest rates, but with the additional factor of increased likelihood of a consumer led U.S. economic recession,” stated Kenneth Heinz, president of HFR.

Macro hedge funds, which bet on macroeconomics trends, gained 9.32% in the same period, despite a loss of 0.31% in May.

Performance among hedge funds has been quite divergent this year. While the top decile of hedge funds posted an average positive performance of 33.9% in the first five months of the year, the bottom was down 25.7%.

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