What are Hedge Funds?

Hedge funds are actively managed investment vehicles that employ sophisticated strategies designed to deliver returns differentiated from those of traditional stocks and bonds. Hedge fund managers can use tools such as long/short positioning, derivatives, active risk management, advanced technology and human insight to pursue opportunities that are available to traditional long-only strategies. As a result, hedge fund strategies can consistently generate alpha and deliver risk-adjusted outcomes across all market environments.

Why consider Hedge Funds for your portfolios?

Diversifying Exposure Across Changing Market Environments

Hedge Fund Correlation with a Traditional 60/40 Portfolio

Rolling 12 months correlation. Data are based on availability as of April 30, 2026. Source: Bloomberg, FactSet, HFR, Standard and Poor’s, J.P. Morgan Asset Management. The Traditional 60/40 Portfolio is an unmanaged hypothetical index composed of 60% S&P 500 and 40% Bloomberg US Aggregate. The Hedge Fund is represented by HFRI Macro. Past results do not guarantee future performance.

Hedge Fund Strategy Universe

A broad toolkit across market environments

Source: Preqin, Hedge Fund Strategies.

Hedge Fund Have Delivered More Resilient Returns During Periods of Elevated Market Volatility

Hedge Funds vs Global Equities Performance and Volatility

Average monthly returns by VIX level, 01/1998 to 03/2026, USD total return. Source: CBOE, FactSet, MSCI, PivotalPath, J.P. Morgan Asset Management. Monthly VIX reading is an average. Hedge funds: PivotalPath Composite Index. Global equities: MSCI All Country World Index. Past results do not guarantee future performance.

Hedge Fund Can Improve Risk-Adjusted Returns

Risk-return comparison between a traditional 60/40 portfolio and a diversified portfolio over 10-year (top) and 20-year (bottom) periods.

Data are as of April 30, 2026. Source: HFR, Bloomberg, MSCI. FRED, Westcourt Analysis. Returns and volatility are annualized based on monthly data. Sharpe ratios are calculated using annualized return in excess of the average 3-month U.S. Treasury Bill rate over each corresponding period, divided by annualized volatility. The Traditional 60/40 Portfolio is an unmanaged hypothetical index composed of 60% MSCI World TR and 40% Bloomberg Global Aggregate. The Hedge Fund is represented by HFRI EH Multi Strategy Index. For illustrative purpose only. Past results do not guarantee future performance.

Hedge Fund