Several prominent multistrategy hedge funds suffered significant losses in March, continuing a trend of difficult early-year performance as global markets were buffeted by geopolitical tensions. For the second consecutive year, the month proved challenging for major investment managers, with firms like Balyasny Asset Management and LMR Partners recording notable declines.
The $33 billion firm Balyasny Asset Management was down 4.3% in March, bringing its year-to-date loss to 3.8%, according to a source close to the company. London-based LMR Partners saw its multistrategy fund drop 2.4% for the month. Walleye Capital also reported a loss of 1.3% in March.
Mixed Performance Across the Sector
Not all firms faced the same headwinds. Schonfeld Strategic Advisors, which now manages $19 billion in total assets, reported a flat performance for March and remains up 0.9% for the year. Meanwhile, Asia-based managers Dymon Asia and Pinpoint Asset Management lost 4.3% and 2.5% respectively in March, though both retain positive returns for 2025 overall.
The chaotic start to the year has been largely attributed to renewed geopolitical instability. In 2025, markets were rocked by widespread tariffs implemented by the administration of President Donald Trump. This year, the primary shock has been American and Israeli military strikes on Iran, which have thrown global economies into turmoil and left many investment managers in negative territory.
Macroeconomic Bets Backfire
The market volatility specifically hurt many macro funds in March. A common trade betting that short-term interest rates in the UK and Europe would fall soon backfired. This was due to expectations that inflation would rise because of higher energy prices stemming from the ongoing Middle East conflict.
Earlier in the first quarter, a significant sell-off in software stocks also contributed to the difficult environment. This was driven by investor unease over perceived advances in artificial intelligence tools from start-ups like Anthropic. The combination of shaky geopolitics and sector-specific pressures led to the worst quarter for the S&P 500 since 2022, with the index falling 4.6%.
The Multistrategy Model Under Pressure
Multistrategy hedge funds, which spread capital across multiple independent teams running diverse investment strategies, are designed to deliver consistent returns in various market conditions. This subset of the industry has garnered significant attention in recent years due to the enormous compensation packages offered to top traders at these large, rapidly growing firms.
The firms mentioned in this report all declined to comment on their performance figures. The challenging conditions of March 2025 underscore the ongoing difficulty of navigating a global investment landscape increasingly defined by unpredictable political events.