What would seem like a sure win for elite investors — early bets on companies racing to make face masks, hand sanitiser and other coronavirus-related protective products — turned out to be a relatively unpopular strategy and one with surprisingly mixed results.

A few hedge funds increased their holdings over the first quarter in companies associated with so-called personal protective equipment (PPE) such as 3M Co., Kimberly-Clark Corp and Honeywell International Inc, according to a Reuters review of regulatory filings compiled by research firm Symmetric.io showing stock positions as of March 31.

Hedge funds, on a net basis, sold off more than $760 million in those three stocks over the first quarter, according to Symmetric.io data, bringing the number of funds that own them down to 225 from 230.

Ironically, firms that seized on the opportunity early, including Maverick Capital, Point72 Asset Management and D.E. Shaw Group, have likely faced paper losses given share price declines so far this year, assuming they still hold those stocks.

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Playing the pandemic, investors said, was difficult amid roller-coaster trading fueled by fears of the virus' spread, surging unemployment rates, tumbling oil prices and government stimulus spending. By the end of March, the S&P 500 stock index had ended its 11-year bull market run and was off around 20 per cent for the year.

Adding to the complexity, the large companies now closely associated with protective equipment faced separate challenges.

St. Paul, Minnesota-based 3M, for example, became a household mask name as people around the country raced to hardware stores and online to buy the company's N95 products. But the company's stock price is off 15.4 per cent this year as mask sales make up only a small portion of revenue, broadly hit as products for the manufacturing sector lagged as factories like automakers were shut down.

Hedge fund firms Alyeska Investment Group, Laurion Capital Management, Point72 and Balyasny Asset Management all put on new positions in 3M during the first quarter, filings show; Millennium Management added to its sizable holdings.

Representatives for the firms declined to comment on the investments or did not respond to requests.

Honeywell, which makes electronics and materials for the aerospace, building and other industries, also ramped up its mask-making business as the virus spread.

Maverick, already a top holder, added to its stake in the first quarter and Arrowstreet Capital, put on a new position, filings show. Still, Honeywell's stock price is off 24.3 per cent, more than the S&P 500's roughly 8 per cent loss this year.

Hedge fund bets on smaller PPE-focused companies produced better results.

Balyasny and Arrowstreet were among the hedge funds to initiate investments over the first quarter in protective clothing maker Lakeland Industries, valued at $108 million. Lakeland's stock price is up 26 per cent this year.

Tudor Investment Corp, Millennium and Arrowstreet all made new investments in MSA Safety during the first quarter, filings show. Stock of MSA, which makes protective face gear among other things, has gained 12 per cent in the last four weeks but remains off 4 per cent for the year.

And Tiburon Opportunity Fund LP, a small hedge fund that usually focuses on financial stocks, held and slightly added to its position in Edison Nation Inc, which recently scored a large sanitizer and mask contract. The small company's stock price rocketed higher to now trade with a 22 per cent gain for the year.

Tiburon boss Peter Bortel told Reuters that his fund is off about 16 per cent for the year but that PPE-related bets have helped mitigate those losses.

"There was clearly a great business opportunity," Bortel said.