Protecting the downside: how hedge funds shield against tariff turbulence

Once again, US President Donald Trump is dominating global headlines—this time with economic policies that carry broad global consequences.

- MARINA KOTSOPOULOS

His focus on aggressive tariff strategies has injected sharp volatility into markets, with abrupt sell-offs followed by relief rallies, reflecting the unpredictable nature of current trade dynamics.

South Africa, deeply integrated into global trade networks, has not been immune. The South African economy faces both direct exposure and second-order effects from tariff-related tensions, particularly given that two of its largest trading partners are the United States and China. These developments have rattled investor sentiment and highlighted the structural vulnerabilities of an interconnected global economy.

In such environments, traditional investment strategies often falter. Hedge funds, however, are uniquely positioned and well-equipped to thrive from such volatility. Their ability to employ active, tactical strategies allows them not only to manage risk but also to exploit market dislocations.