SS&C GlobeOp Hedge Fund Performance Index and Capital Movement Index

The SS&C GlobeOp Hedge Fund Performance Index reported a gross return of 0.85% for May 2025, while the Capital Movement Index advanced 0.59% in June, marking the fifth consecutive month of positive net inflows. Despite a decrease in market volatility from April highs, uncertainty persists due to ongoing geopolitical conflicts and extended tariff deadlines, with SS&C's CEO Bill Stone noting that hedge funds offer diversification benefits during these uncertain times. The Performance Index's correlation to equity markets remains relatively low at 25-30% since its inception in 2006.

Analysis

The SS&C GlobeOp Hedge Fund Performance Index reported a gross return of 0.85% for May 2025, contributing to a year-to-date gross return of 2.51% and a last-12-month return of 7.45%. This performance occurs within a context of continued investor appetite for hedge funds, as evidenced by the SS&C GlobeOp Capital Movement Index, which advanced 0.59% in June 2025, marking its fifth consecutive month of positive net inflows. This inflow pushed the Capital Movement Index to 126.38 points, a 12-month high and an increase of 1.82 points over the past year. Bill Stone, Chairman and CEO of SS&C Technologies, highlighted that while market volatility has decreased by over 50% from its April 2025 highs, persistent uncertainty stemming from extended tariff deadlines and ongoing geopolitical conflicts makes the diversification benefits of hedge funds an attractive allocation option. The Performance Index’s historical low correlation to equity markets, approximately 25-30% since its 2006 inception, further supports this diversification argument particularly in the current environment.

Key Decisions for Investors

• Investors should consider the observed positive net inflows into hedge funds, now in their fifth consecutive month, as a signal of strengthening sentiment towards the asset class for diversification amidst ongoing market uncertainties.
• Evaluate allocations to hedge funds in light of their potential to offer diversification benefits, underscored by the SS&C GlobeOp Hedge Fund Performance Index's historically low correlation (25-30%) to equity markets, especially as geopolitical and trade-related uncertainties persist despite reduced market volatility.
• Monitor the SS&C GlobeOp Capital Movement Index for sustained positive trends, as continued inflows would further validate the attractiveness of hedge funds in the current investment landscape, while also noting the reported 0.85% gross monthly performance as a recent benchmark for the sector.