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In the week ending May 16th 2025, the latest Q2 2025 Hedge Fund Strategy Outlook by K2 Investment Management revealed that the hedge fund industry is adapting to a rapidly changing macroeconomic and geopolitical environment. The uncertainty has not only persisted but intensified over the past quarter, reinforcing the case for dynamic and flexible investment strategies. In Q1, market sentiment was shaped by high economic uncertainty, elevated geopolitical tensions, and tight credit conditions. These pressures have not subsided-in fact, geopolitical risks and macroeconomic unpredictability have increased. Yet valuations have started to retreat, and credit spreads are gradually widening. This evolving backdrop is creating both significant risks and compelling opportunities for hedge fund managers.

Meanwhile, hedge funds navigated a historic volatility surge and violent extremes in risk sentiment, as global financial markets plunged in early April 2025 on trade and tariff uncertainty before posting an equally dramatic recovery. Through this intense equity and fixed income trading month, the HFRI Equity Hedge Index posted an undramatic gain of +0.7% (-0.88% YTD).

In new launches, European private credit manager Pemberton Asset Management has raised €8.4bn ($9.4bn) in its latest fundraising cycle for its three direct lending strategies; Alternative investment manager Blue Owl Capital closed its Blue Owl Digital Infrastructure Fund III (ODI III) with $7 billion in total capital commitments, s......................

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