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Quants rack up big Q1 gains

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Soaring cocoa prices and a slump in the Japanese yen are among several financial market trends that have helped computer-driven quant hedge funds to rack up strong returns in the first quarter of the year, according to a report by the Financial Times.

The report cites an index compiled by Société Générale in revealing that trend-following funds operated by firms including Man Group, Aspect Capital and Winton are up around 12% for the year to the end of March.

According to Razvan Remsing, Director of Investment Solutions at London-based quantitative hedge fund Aspect, which manages $9.4bn in assets, things have never been better.

The report quotes Remsing: “We have been trading for 25 years and this was our best first quarter ever.”

Other quant funds at Winton, AQR and Capital Fund Management have also enjoyed a bumper start to the year with gains of 13%, 17.4% and 17.5% respectively.

Meanwhile, Aspect has chalked up a 21.4% gain for its flagship fund, having upped its leverage from a long-term average of four times to seven times to capitalise on several unrelated trends.

This year’s performance is in stark contrast to 2023 when trend-following strategies were hit hard by the collapse of Silicon Valley Bank in March last year and a subsequent hike in bond prices.


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