Citadel founder Ken Griffin said a move to cash would have been the most prudent choice during April’s tariff-driven market volatility. Despite a challenging environment, Citadel posted gains across multiple strategies.
Ken Griffin, founder and CEO of Citadel, acknowledged that during the height of April’s trade policy turbulence, the best course of action for many investors may have been to step back and move to cash.
“In retrospect, perhaps holding cash would've been the best way to navigate this,” Griffin told Bloomberg in a recent interview. “But that’s so contrary to our culture of always trying to be on the offense, always trying to find ways to create value in the markets.”
Griffin’s comments reflect the broader difficulties active managers faced last month as President Donald Trump’s shifting trade policies injected volatility into equities and fixed income. The administration’s imposition of reciprocal tariffs, followed by quick reversals and ambiguous policy signals, created a highly uncertain environment for fundamental analysis and positioning.
“The value of companies we invest in was being dictated by fast-changing decisions in Washington, not by business fundamentals,” Griffin noted. “That’s a difficult backdrop for long-term investing.”
While equity markets have since recovered the losses triggered by the early-April trade developments, the road has been volatile. The S&P 500 fell sharply in the first half of April before clawing back those losses, ending the month with modest gains. For many institutional investors, the whipsawing conditions made risk management more challenging than usual.
Griffin emphasized that while a retreat to cash may seem obvious in hindsight, Citadel remained committed to its investment process and managed to generate positive performance despite the headwinds. The firm’s flagship multi-strategy Wellington fund gained 1.3% in April, a testament to its diversified approach and tactical agility. Meanwhile, Citadel’s Global Fixed Income fund returned an impressive 4.6% during the month, demonstrating the strength of its relative value strategies in volatile fixed income markets.
The comments from Griffin offer a candid look at how top-tier asset managers grappled with uncertainty surrounding U.S. trade policy and geopolitical tensions. The Citadel founder also acknowledged that April presented one of the most difficult investment climates in recent memory, not due to traditional macroeconomic forces, but rather because of unpredictable policy swings.
Griffin’s perspective is particularly relevant for RIAs and wealth managers seeking to understand how institutional investors positioned themselves during recent periods of market stress. While cash often plays a limited role in long-term client portfolios, his remarks underscore the importance of liquidity as a tactical tool and the value of remaining flexible in uncertain markets.
Citadel’s performance highlights how active managers with broad mandates and robust risk controls can still identify opportunities—even when macro conditions become the dominant driver of asset prices. In this case, while Griffin hinted that caution would have been optimal, his team still managed to find alpha in a difficult month.
For advisors, the key takeaway is not to embrace market timing or abandon fundamental analysis, but rather to ensure that portfolios are positioned with enough flexibility to withstand short-term shocks. Griffin’s call to cash was not a strategy shift, but a reflection on how difficult it was to remain offensive when headlines were moving markets hour by hour.
Looking ahead, Griffin warned that headline risk will continue to shape short-term investor sentiment, particularly with trade, monetary policy, and geopolitics in flux. For fundamental investors, this creates an environment where traditional valuation frameworks may offer limited guidance.
“It’s not that fundamentals don’t matter,” Griffin said. “It’s that in certain periods, they get drowned out by noise. And in those moments, having a strong risk management framework is more important than ever.”
Wealth advisors can draw several implications from Griffin’s outlook. First, even institutional players see merit in holding cash as a defensive position during periods of elevated uncertainty. Second, active strategies with access to global macro and relative value trades may offer valuable diversification when traditional equity and bond correlations rise. Third, communication with clients about the source and nature of volatility—especially when driven by policy rather than fundamentals—can help preserve confidence in long-term investment plans.
Griffin’s reflection offers a rare glimpse into how one of the world’s most successful hedge fund managers evaluates risk and reward under pressure. His remarks validate the challenges advisors and portfolio managers faced in April, while also reaffirming that discipline, diversification, and tactical flexibility remain critical in navigating uncertainty.
For RIAs working with clients concerned about policy-driven volatility, the Citadel example is instructive. Rather than retreating entirely from the market, Griffin’s team managed risk with precision, adjusting exposure dynamically while still seeking value across asset classes. The result: positive returns in an otherwise unpredictable month.
As trade policy remains fluid and election-year headlines loom, advisors may want to revisit how they’re allocating risk in client portfolios. Maintaining exposure to managers with multi-strategy flexibility or integrating liquid alternatives that can adapt to policy-driven dislocations could offer downside protection and diversification benefits.
Griffin’s commentary also reinforces the importance of keeping client expectations aligned with market realities. In some environments, even top-performing funds will suggest that capital preservation—rather than aggressive positioning—is the appropriate goal. This message is especially pertinent in a cycle where valuation signals are muddled and policy unpredictability has become a recurring theme.
Ultimately, Griffin’s suggestion that “holding cash might have been best” doesn’t contradict active management—it highlights the value of discretion, timing, and knowing when to shift gears. For advisors, the lesson is to build investment frameworks that account for these dynamics while keeping clients grounded in long-term strategy.
While April may be in the rearview mirror, its lessons remain relevant. Volatility driven by policy shocks is not likely to abate in the near term. As Griffin’s remarks show, navigating these conditions requires a blend of tactical awareness and strategic discipline—tools that every advisor can apply, regardless of market direction.
