Hedge funds collectively had a big harvest last year, with the industry achieving its highest return rate in 16 years.

According to data compiled by industry tracking firm Hedge Fund Research Inc., the industry with a size of approximately $5 trillion achieved a return of around 12.6% last year, the best performance since 2009. The AI boom, geopolitical shocks, and uncertainty about interest rate prospects have led to significant market volatility, creating many opportunities for trading strategies that thrive on volatility. Funds managed by industry giants such as D.E. Shaw, Millennium Management, Citadel, Point72 Asset Management, and Qube Research & Technologies have all recorded double-digit returns. Bridgewater Fund's flagship product Pure Alpha II even achieved a historic high return rate of 34%.