PivotalPath’s analysis shows managed futures and macro commodities thriving in high oil environments, but allocators heading into 2026 had other priorities.
Crude oil has exploded higher in recent weeks, with WTI surging from around $64 in late February to nearly $120 a barrel on Monday before pulling back to the high $80s, as the escalating conflict in the Middle East and the effective closure of the Strait of Hormuz upend global energy markets. Oil is now firmly in the kind of extreme price regime that historically separates winning hedge fund strategies from the rest.
Research from PivotalPath, the hedge fund analytics firm, puts hard numbers behind what that means for portfolios. Using its new Regimes tool, the firm examined how hedge fund strategies performed across different crude oil price environments. The findings, shared by CEO and founder Jon Caplis on LinkedIn, are quite instructive.
In periods when crude traded between $100 and $140 a barrel, the S&P 500 fell 1.6% on an annualised basis. Broader hedge fund returns were muted too, with the PivotalPath Composite Index returning just 2.5%. But managed futures stood out at 9.1% and global macro commodities strategies gained 8.8%.
At the other extreme, when oil dropped below $50, equities were flat at 0.7 per cent while hedge funds thrived. The Composite Index returned 10.2%, with global macro discretionary and commodities strategies each topping 13%.
The impact of oil prices on hedge fund strategies “has become the question for allocators,” Caplis said, adding that uncorrelated returns and hedge fund risk mitigation now truly matter.
The findings align with some of what allocators told Hedgeweek® earlier this year, but not all of it.Â
In our Global Allocator Outlook published in January, global macro ranked as the second most preferred strategy heading into 2026, with more than half of respondents placing it in their top two. But managed futures and CTAs ranked seventh out of nine categories, with over half of allocators placing them in their bottom three.
Given PivotalPath’s data showing managed futures as the strongest performer in high oil regimes, that gap looks worth revisiting.
