Bridgewater Associates' flagship Pure Alpha macro fund rose 8.1% during the first half of the year, according to people familiar with the matter. The performance came as markets experienced heightened volatility related in part to the Iran war, an episode that produced sharp losses across parts of the hedge fund industry before a subsequent rebound.
Equity benchmarks provided a supportive backdrop for the period. In the first six months of the year, the S&P 500 climbed 9.67% while the Nasdaq Composite advanced 12.48%, with both indexes moving closer to record highs. Large multi-strategy hedge funds also produced strong returns - two sources said that firms such as Millennium and Point72 delivered double-digit gains over the same period.
Bridgewater, which manages roughly $102 billion in assets, has diversified its strategy set in recent years. One notable initiative is a fund that leverages artificial intelligence to inform investment decisions. That vehicle, called the AIA Macro fund, posted an 8.1% gain in the first half as well, according to one of the sources. Launched in late 2023, the AIA fund has produced an annualized return of 11.3% since inception and currently manages approximately $4.5 billion.
The firm’s exploration of AI-driven investing traces back to 2018, when the effort began under co-CIO Greg Jensen. Jensen leads Bridgewater’s Artificial Investor team and concurrently serves as a managing CIO for the Pure Alpha strategy.
Bridgewater’s first-half performance follows a period of exceptional results the firm recorded more recently. During the same stretch last year, the Pure Alpha 18 fund rose 17% as traders at the firm capitalized on tariff-driven market uncertainty. For 2025, the fund posted a 34% surge in returns, contributing to the firm’s highest profits on record.
Commenting on the industry’s broader performance so far this year, Tony Pasquariello, head of hedge fund coverage at Goldman Sachs, said in a client note that the hedge fund community has continued to perform well. He noted that nine distinct hedge fund cohorts tracked by his team all produced positive year-to-date returns, with particular strength in fundamental long/short and the macro space.
Strategic reset and leadership shifts
Bridgewater’s recent results coincide with a strategic realignment initiated after Nir Bar Dea assumed the CEO role in 2023. The reorganization followed years of underperformance prior to Bar Dea’s appointment as co-CEO in 2022. The firm also experienced an ownership and governance change when founder Ray Dalio sold his remaining stake last year and stepped off the board.
Earlier this year, Bridgewater elevated one of its chief investment officers, Bob Prince, to chair of the board of directors. The firm has taken steps to limit new inflows into Pure Alpha and has returned some assets to clients - actions intended to shrink the assets under management in that strategy and focus on maximizing returns for the capital that remains.
Bridgewater’s leadership team includes co-CIOs Karen Karniol-Tambour, Greg Jensen, and Bob Prince. In January, the firm promoted macro trader Ben Melkman to deputy chief investment officer, alongside David Trinh and Blake Cecil.
Firm background
Based in Westport, Connecticut, Bridgewater was founded in 1975 by Ray Dalio out of a two-bedroom New York City apartment. The firm’s evolution over decades has included shifts in strategy, leadership, and product offerings as it adapts to changing market dynamics.
What the results show
The first-half returns for Pure Alpha and the AIA Macro fund underscore a recovery for parts of the hedge fund industry after earlier turbulence. Bridgewater’s mix of traditional macro trading and newer, AI-informed strategies produced parallel outcomes in the period, while the firm’s strategic decisions on asset flows and leadership restructuring appear to be material to its recent trajectory.