Hedge funds saw their second-strongest monthly gain on record in November, following a surge driven by US election results and developments made in the search for a Covid-19 vaccine. 

According to data from Hedge Fund Research, the HFRI Fund Weighted Composite Index soared 6.2% in November - the strongest monthly gain since December 1999 and the second-strongest month since index inception in 1990.  

The HFRI 500 Index also increased by 4.6% for the month, increasing the year-to-date return to 5.6%.

These gains were largely led by equity hedge strategies, which soared on the back of “positive” developments. The HFRI Equity Hedge Index increased by nearly 9% for the month. 

Kenneth J. Heinz, president of HFR, said: “Through the powerful and volatile macroeconomic and geopolitical trends which have defined 2020, institutions have continued to increase allocations to hedge funds and other alternatives, building in strong performance momentum and positioning for acceleration of these gains into 2020.”

Blockchain and cryptocurrency exposures were also said to drive industry gains, as hedge funds continue to increasingly incorporate related exposures into new and existing fund strategies. 

The HFR Blockchain Index increased by 53.4% in November, vaulting year-to-date 2020 performance to 159.2%, while the HFR Cryptocurrency Index soared 57.2%, according to the report. 

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