Wednesday was the largest drawdown for multi-strategy hedge funds since April. Bloomberg cited GS and JPM prime. Also painful for quants as momentum trades unwound. Healthy reminder not to get too excited about last year’s strong returns and inflows for the industry.

Gross leverage for multi-strategy hedge funds have been running in the 12x region up on 8x 5 years ago and 4x a decade ago. Some of that is highly leveraged FI basis trades but leverage has been rising across the board including in quant.