The trade that gave hedge fund managers collective heartburn in 2024 is back from the dead. Goldman Sachs reports that active-extension strategies, the 130/30 trades sometimes called “hedge fund-lite,” have staged a full recovery after a bruising stretch of underperformance and investor flight last year.
Assets in these strategies have climbed back to roughly $153 billion as of early 2026, according to Goldman Sachs data. That’s a significant turnaround for a corner of the market that saw painful outflows when volatility and rising interest rates made 2024 feel like a stress test nobody signed up for.
What exactly is a 130/30 trade
Think of it as traditional long-only investing with a twist. A 130/30 strategy goes 130% long on stocks the manager likes and 30% short on stocks they don’t. The net exposure stays at 100%, just like a regular fund, but the manager gets to express conviction on both sides of the ledger.
These strategies became popular precisely because they offered a middle ground. Institutional investors who couldn’t stomach the fee structures and lockup periods of full-blown hedge funds could still access some of that short-selling alpha. When markets cooperate, it works beautifully. When they don’t, the leverage bites.
