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By: Steven Brod, CEO and CIO of Crystal Capital Partners: Investor appetite for macro hedge fund strategies has grown meaningfully in recent years. At the end of last year, a Societe Generale survey found that global macro was at the top of institutional investors' hedge fund allocation lists for 2025. Yet performance in the first half of this year may have given allocators pause: macro managers have posted sharply divergent results amid renewed market volatility. The answer isn't to sidestep macro altogether, it's to understand the differences between strategies and recognize that diversification is key to building a more resilient portfolio.

The hedge fund industry is projected to reach $5 trillion by 2028, and we can expect that macro strategies will capture a significant share of this expansion. Allocators will likely be drawn in by strong returns and the appeal of strategies designed to thrive amid global instability. For example, PivotalPath's Global Macro Index ended December 2024 up +1.6%, with a full-year gain of +6.2%, helped by anticipated future currency volatility and policy divergence among central banks.

Before allocating, it's crucial to understand the differences between macro hedge fund strategies. Discretionary and systematic (also referred to as "quant") macro funds follow different paths to returns and come with distinct advantages and risks. Discretionary macro strategies emerged in the 1970s, relying on top-down, human-le......................

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