LONDON, June 17 (Reuters) - Hedge fund managers making bets on mergers and acquisitions outperformed those deploying other strategies with a return of 7.7% in the first five months of 2024, Goldman Sachs said in a note to clients, as deal-making rebounded.

Although Goldman did not offer a year-earlier figure for comparison, Barclays prime brokerage noted at the time that such fund mangers had returned a negative 0.8% on investment from January to May 2023, as high interest rates curtailed deal making.

While seeing a resurgence this year as companies gain confidence from declining interest rates and a stabilising economic backdrop, global deal-making has yet to return to 2021's record levels.

Worldwide M&A was worth $1.3 trillion during the first five months of 2024, a 23% increase versus the same period of 2023, but below the $1.8 trillion recorded in January-May 2022, according to LSEG data.

According to LSEG, U.S.-targeted M&A has accounted for 56% of overall global M&A this year, the highest year-to-date share since 1998.

Deals have included consumer bank Capital One's $35.3 billion bid for credit card issuer Discover Financial Services in February and ConocoPhillips’ $22.5 billion offer for Marathon Oil in May.

Hedge funds generally averaged around a 7% return on investment through end-May, Goldman Sachs said. Stock trading hedge funds returned 7.4%, helping to lift the average of the group.

Hedge funds that bet on the relative price of two assets performed the least strongly, returning about 5% for the year, said the bank.

(Reporting by Nell Mackenzie; Editing by Amanda Cooper and Kirsten Donovan)