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CTAs struggling to repeat 2022’s success

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Violent swings in asset prices coupled with rapid shifts in investor interest rate expectations have impacted commodity trading advisers (CTAs) so far in 2023, making a repeat of last year’s bumper returns from bets on prevailing global market trends, increasingly unlikely, according to a report by The Financial Times.

The report cites performance figures seen by The FT as showing that trend followers, including Leda Braga’s Systematica and Stockholm-based Lynx Asset Management, have posted losses of close to 10 per cent so far this year, while others have also struggled to make money.

CTAs were among the world’s top performing hedge funds last year on the back of bets in gains for commodities and declines for stocks and government bonds.

But generating profits has proved problematic so far in 2023 with Systematica, which manages roughly $17bn in assets, having lost 9.6 per cent YTD in its Bluetrend fund after gaining 30 per cent last year, and Lynx, which runs $7bn, seeing a 9.3 per cent fall in one of its main funds after generating a 36.8 per cent return in 2022.

And Quest Partners, which follows short-term trends and manages $1.6bn in assets, is reportedly down 12.1 per cent as of 11 August, having delivered a 25.2 per cent gain last year.

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