The generally strong performance of leading equity markets across Western Europe has helped European-focused hedge funds to deliver strong returns

One the long side, banks and defence names have been key contributors this year, while shorts in industries hit by AI-driven disintermediation - particularly call centre and advertising companies - have added meaningful alpha

The backdrop for merger arbitrage funds has improved over the year and the recent announcement of the USD 55 bn Electronic Arts transaction, the largest LBO ever, indicates that risk appetite is strong

Event driven funds with expertise in German domination agreements can extract alpha from the guaranteed payment and the chance of a court-driven top-up

According to research, AI related stocks have accounted for 75% of S&P returns, 80% of earnings growth and 90% of capital spending since ChatGPT was launched in November 2022