This was meant to be Deepak Gulati’s moment.

The hedge fund manager has been waiting for the return of market volatility to help him recover losses after years of calm markets hurt his $955 million firm. Yet even with the recent whipsaw in stocks, Gulati hasn’t made any money through the first 10 months of the year.

Wide swings in prices, a waning bull market and rising rates were seen as the elixir that the $3.2 trillion industry needed to overcome years of subpar performance. But hedge funds got pummeled in last month’s market swoon and are headed for their worst year since 2011.

“They should have made money,” said Arvin Soh, a New York portfolio manager at GAM Holding AG, a Zurich-based asset management firm that invests in hedge funds. “Big picture, hedge funds are strategies that are meant to deliver during periods of uncertainty and profit from dislocations, which we have seen plenty of this year.”

Soh, who has invested client money in hedge funds for 15 years, predicts that given the industry’s performance this year the pressure on managers to close funds or reduce fees will only intensify.

Fund managers already struggling with volatility are facing another challenge: price moves have become more pronounced among the companies that hedge funds expect to rise. The volatility of the top 50 stocks that funds are wagering on is currently at the highest levels since 2010 relative to price swings of the S&P 500, according to a Nov. 20 Morgan Stanley report.

It’s not the first time the industry has been tripped up by volatility. In 2011, as Europe’s sovereign debt crisis roiled global markets, funds lost an average of 2.1 percent, according to data compiled by Hedge Fund Research Inc. A slew of managers were forced to close their businesses.

Gulati, who heads Argentiere Capital in Zug, Switzerland, focuses on betting on price swings across markets and only posted gains of about 1 percent during the market turmoil in February and October.

The money manager, who was formerly head of global equity proprietary trading at JPMorgan Chase & Co., has told investors that it’s been difficult to profit in part because volatility has been limited to stocks. Wide market moves will need to be sustained before managers who focus on such a strategy can turn things around.

“Let’s not forget one thing: equity markets are up on the year,” Gulati said in an interview. “It’s not like we have entered yet at all into bear market territory.” Risk premia, or the payoff that investors expect for holding riskier assets, “has not expanded at all,” he added.

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