Risk-on sentiment returned in May, supported by strong earnings from U.S. companies and easing trade tensions between the U.S. and China. Nordic hedge funds benefited from the improved market environment, recording their second-best monthly performance of the year with an average gain of 1.5 percent. Meanwhile, the stop-and-go nature of U.S. President Donald Trump’s tariff policymaking generated significant short-term volatility without establishing clear long-term trends, resulting in a fourth consecutive month of losses for trend-following managers.

All strategy categories within the Nordic Hedge Index ended the month in positive territory – with the exception of CTAs. Systematic trend-following CTAs, macro, and managed futures strategies posted losses for the fourth consecutive month. Equity long/short managers gained an average of 2.1 percent, while long-only equity managers – a separate category outside the Nordic Hedge Index – advanced by an average of 6.9 percent, bringing their year-to-date performance back into positive territory.

Diversified funds – including multi-asset, multi-strategy, and niche approaches – also had a strong May, posting an average gain of 2.4 percent, which nudged their 2025 performance just back into positive territory. Fixed-income hedge fund strategies, the best-performing category within the Nordic Hedge Index so far this year, rose 1.1 percent in May, extending their year-to-date gain to 4.0 percent. Multi-manager funds, meanwhile, edged up 0.8 percent during the month but remain down 0.5 percent for the year.

The performance dispersion between the best- and worst-performing members of the Nordic Hedge Index remained relatively stable, narrowing slightly to 8.1 percent in May from 8.4 percent in April. However, the overall distribution improved: top performers delivered stronger returns, while losses among the weakest funds were more contained. In May, the top 20 percent of reporting funds posted an average gain of 5.7 percent, compared to 3.8 percent in April. Meanwhile, the bottom 20 percent registered an average loss of 2.4 percent, significantly less than the 4.6 percent decline seen the previous month. Overall, four out of five reporting funds ended May in positive territory. Year-to-date, 66 percent of the Nordic Hedge Index constituents remain in the black.

10 Best Performing Nordic Hedge Funds in May 2025

After delivering a 54 percent return in 2024 – the second-highest in the Nordic hedge fund industry – Impega has carried its strong momentum into 2025. The equity-focused hedge fund, managed by a former Norges Bank Investment Management (NBIM) professional, gained 16.2 percent in May, lifting its year-to-date performance to 23.7 percent.

Atlas Global Macro, a theme-driven hedge fund co-managed by Lars Tvede, gained 11.7 percent in May, pushing its year-to-date performance into positive territory at 7.3 percent. Sissener Canopus, managed by a team of active stock pickers with a flexible mandate, posted its second-best monthly return since inception in 2012, gaining 11.4 percent in May. This strong performance more than offset earlier losses from the year, with further gains in June bringing the fund’s year-to-date return to about 8.0 percent.

The discretionary macro fund Brobacke Global Allokering rebounded with a 7.5 percent gain in May, following three challenging months, reducing its year-to-date loss to 6.1 percent. Meanwhile, Avanto Right Tail and Proxy Renewable Long/Short Energy both advanced 6.9 percent during the month. Looking at the broader universe that includes long-only equity funds, concentrated equity fund Asilo Argo took the spotlight with a surge of 21.3 percent. This performance pushed Asilo Argo’s year-to-date gains to 13.1 percent. 

Top Performing Long-Only Equity Funds

In September of 2023, HedgeNordic introduced a new sub-strategy category to the Nordic Hedge Index: Equity Long-Only (ELO). This category is home to funds that would fall short of qualifying as a hedge fund due to their long-only trading approach but exhibit habitual characteristics of a hedge fund strategy (e.g., leverage and derivatives usage, portfolio concentration, fee structure, a spin-off of a long/short strategy, and absolute return objectives, among others).