Hedge funds turned in one of their strongest first-half performances in nearly three decades, according to exclusive data from PivotalPath, with technology specialists leading gains and multi-strategy funds continuing their steady climb.
The PivotalPath Composite Index returned 7.3 percent in the first six months of 2026, the eighth-best first half in the index's 29-year history. The gain was well above the historical first-half average of 5.15 percent and median of 4.39 percent, nearly doubling the 4 percent return posted during the first half of 2025. It was also the strongest first half since 2013, if 2021 is excluded.
Strong headline returns masked a more uneven picture beneath the surface, with wide dispersion across strategies and only a handful of standouts driving performance.
Every month Institutional Investor publishes a subset of hedge fund indices from PivotalPath. Scroll to the end of the article to view 11 indices, including credit, equity diversified, equity market neutral, global macro, relative value, and others.
April's 3.7 percent gain was the strongest April on record and the sixth-best monthly return since 1998.
Technology, media, and telecommunications managers led all equity-sector strategies, with the TMT Index returning more than 27 percent during the first half. Healthcare funds climbed nearly 11.5 percent through June after a 6 percent gain during the month.
Multi-strategy managers continued to post steady gains, returning 6.6 percent through June despite a setback in March when the Multi-Strategy Index lost 1.4 percent, its only negative monthly print of the year. Even so, the losses were more than recovered over April and May.
(Click here for the latest index performance data and access to PivotalPath's full suite of hedge fund indices.)
Not every strategy kept pace. Equity quantitative managers were essentially flat through June after a series of momentum reversals, while discretionary global macro returned a more muted 2.37 percent. Credit strategies also lagged, with the main Credit Index up 3.6 percent, although convertible arbitrage gained 7.03 percent.
Since January 2020, the Composite Index has generated 8.5 percent annualized returns with 5.6 percent annualized volatility, a consistency that PivotalPath says is helping renew investor interest in hedge funds, particularly relative to private equity and private credit.
