Several commodity trading advisors posted strong results in January that more than doubled the S&P 500.
The large monthly gains are especially impressive given that the computer-driven strategy, also known as managed futures, historically has almost no correlation to the stock market. But if equities continue to either sell off or maintain their early-2025 volatility, it could wind up being a very strong year for these funds, many of which deploy trend-following strategies.
One fund picked up where it left off last year: the Mulvaney Global Markets Fund. The long-term trend-following program, which seeks to deliver high absolute returns in rising and falling markets, surged 12.45 percent in January after posting a nearly 83 percent gain in 2024, according to a CTA database. The program invests in futures contracts linked to a diverse range of commodities and financial assets, per the fund’s description. Last year, most of its gains came from soft commodities.
The Quantedge Global Fund was up 7.28 percent last month after climbing 30.68 percent in 2024, according to a different database. The systematic quantitative investment strategy is diversified across multiple asset classes such as equities, bonds, commodities, currencies, and insurance-linked securities, the fund’s website says.
Elsewhere, the DUNN World Monetary & Agriculture Program (WMA) rose 6.74 percent in January and the World Monetary & Agriculture Institutional Program — a one-half leverage version of the WMA strategy — was up 3.41 percent, per the firm’s monthly client report, seen by Institutional Investor. Performance was driven primarily by moderate gains in stocks, agriculturals, and metals, which more than made up for small losses in currencies, energies, and fixed income. Volatility ended the month virtually flat.
Looking ahead, the fund’s largest exposures remain long stocks, net short fixed income, and short currencies against the U.S. dollar, the report noted. “Moderately sized positions are held in net long agriculturals and net long metals, followed by net long energies and a small short VIX position,” it added.
Several funds posted more-modest gains last month.
The Aspect Diversified Fund was up 1.22 percent, according to a hedge fund database. It is described as an enhanced systematic medium-term trend-following program that seeks to generate significant medium-term growth, uncorrelated to returns from major asset classes.
The Tulip Trend Fund gained 0.9 percent. “The strategy has historically demonstrated the ability to perform well during crisis periods, especially those accompanied [by] extended stock market declines,” the fund stressed in client reports seen by II. According to the January monthly report, it lost more last month in the stock market from shorts than it enjoyed gains from longs. It also suffered net losses from interest rates, thanks in large part to long positions in euro zone bonds and money market instruments.
It also had a “significant net positive return” in commodities, primarily from the agricultural markets, with the largest contributions from longs in coffee, livestock, and corn, the report says, noting, “A large part of this was achieved through synthetic market combinations, including hybrids.”
At least one well-known fund posted a loss in January: MAN AHL Diversified was down 0.82 percent. It dropped 0.4 percent in 2024 and 3.05 percent in 2023.
