Kettera Strategies' January 2021 Heat Map Analysis
In January, the financial world witnessed a whirlwind of activity, with various hedge fund indices navigating through the choppy waters of chaotic equities markets and surging cryptocurrencies.
The performance of Equities Long/Short programs was influenced by the Reddit-inspired retail investor frenzy, making profits from short positions riskier. Despite somewhat lucrative equities markets, the timing of reducing exposures toward month-end played a significant role. Most programs in this sector ended January net positive, but there was a staggering dispersion of returns.
Kettera Strategies' Systematic Trend Programs showed mixed performance across markets and asset classes. While long-term trend following programs posted higher returns in June 2025, some still experienced negative results, extending their recent performance drought. Kettera uses "style baskets" to track and analyze these trends, reflecting hypothetical groupings rather than actual investible products.
The model-driven global macro camp faced challenges in January, with commodities offering frustration and only a few quant managers ending the month profitably. On the other hand, Cryptocurrency traders enjoyed their best month ever, with Bitcoin surpassing $40,000 for the first time and Ethereum's relationship with Bitcoin yielding some interesting opportunities. The ratio between Bitcoin and Ethereum dropped from 42.0 to 26.0 by month-end.
Volatility/Options Traders, however, have been on a steady slide since August of last year, and the pop-up in VIX in late January didn't provide the boost many were hoping for.
The BarclayHedge Currency Traders Index and BTOP FX Traders Index, along with the Eurekahedge Long Short Equities Hedge Fund Index, Eurekahedge-Mizuho Multi-Strategy Index, CBOE Eurekahedge Relative Value Volatility Hedge Fund Index, and the Eurekahedge AI Hedge Fund Index, were among the indices that saw varied performances during this turbulent month.
Some managers' models were correctly positioned to catch weakening fixed income prices in January, while a blend of the BarclayHedge Equity Market Neutral Index and Eurekahedge Equity Mkt Neutral Index may have offered a more balanced approach.
The S&P GSCI Metals & Energy Index and S&P GSCI Ag Commodities Index also saw their fair share of movement, with Kettera Strategies profiting from long corn and soybean positioning, as well as some spread/relative value programs like KC vs Chicago wheat spreads and reverse cattle crush spreads.
It's important to note that the views expressed in this article are those of the author and not necessarily those of AlphaWeek or its publisher, The Sortino Group.
This article is a guest post for Hedge Funds in the Managed Futures section, published by The Sortino Group. As we move forward, it will be interesting to see how these trends continue to evolve and how hedge funds adapt to the ever-changing market landscape.
- Technology played a significant role in the financial world during January, with cryptocurrencies surging and offering interesting opportunities for traders, such as the relationship between Bitcoin and Ethereum.
- In the realm of sports, hedge funds might find potential for investment in the ever-evolving market landscape, similar to how managers caught weakening fixed income prices with correctly positioned models, much like adapting to a changing game strategy.
