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By Opalesque: Amundi Investment Institute's July 2026 brief argues that hedge funds (HF) enter the second half of 2026 in a favourable position, having delivered strong performance and elevated alpha in H1.
Flows into the industry have continued, driven by return quality, diversification demand, and headline noise around private assets.
However, the report stresses that H2 is not a continuation of "easy beta." Instead, growth is capital expenditure (capex)-driven and narrow - concentrated in AI, power, grids, energy security, defence, and supply-chain reshoring - rather than broadly diffused across the economy. This favours selection and discrimination over passive market exposure, an environment historically conducive to hedge fund alpha generation.
Eight macro themes shaping H2
1. A cyclical sweet spot - growth is strong enough to support risk appetite but not strong enough to lift all assets uniformly, favouring stock/sector/country selection over broad beta, though macro headlines could still cause short-lived distortions.
2. Capex over consumption - the "marginal dollar" goes to building (AI, power, defence) rather than buying, creating dispersion both between capex-exposed and non-exposed segments and within the AI complex itself, as markets debate which players capture value.
3. Monetary divergence without major ruptures - central banks sit near equilibrium, so large directional rate...................... To view our full article Click here
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