- Advertisement -
- Advertisement -

Volt Delivers Electrifying Returns

- Advertisement -

Stockholm (HedgeNordic) – Many hedge funds have been caught flat-footed by the coronavirus-fueled market sell-off, but some funds are performing very well in the current environment. Volt Diversified Alpha, a diversified systematic trading vehicle that uses machine learning and fundamental data to capture price moves across markets, gained 20.3 percent year-to-date through the end of last week after advancing 9.4 percent month-to-date.

Volt Diversified Alpha is powered by the Volt Program, a systematic trading program designed to capture prices moves across major assets classes motivated by changes in underlying economic factors. As “closed schools, travel bans, trade disruptions, postponed events directly impact the economy,” writes CIO Patrik Safvenblad (pictured) in a letter to investors, “the real-life consequences of the Coronavirus are now clearly visible.” According to Safvenblad, “markets saw exceptional volatility, in many cases directly comparable to the 2008 crisis, but market action generally followed the standard risk-off playbook.” Volt Diversified Alpha successfully captured trends triggered by the deteriorating sentiment.

“Trading in energy, soft commodities and fixed income made a roughly equal contribution to results,” writes Safvenblad in a rare mid-month update to investors as a result of the extreme volatility this month. Trading in foreign exchanges markets made a positive contribution too, while the contribution from equity and metal trading was flat. Whereas “risk-taking was around average levels at the beginning of the month,” says Safvenblad, “positions were scaled back as volatility increased.” The Volt Program maintains a bearish stance, but positions have been reduced following the increase in volatility. Despite being fundamental in nature, the program uses technical information for risk management, trade timing and execution decisions.

Breaking down the month-to-date return into smaller components, “fixed-income trading gained from a recently-established long position in Canadian bonds,” says Safvenblad. Long positions in US Treasuries and UK Gilts also added to performance, whereas a short position in the five-year BOBL, the German Bundesobligation, detracted from performance. In energy trading, Volt Diversified Alpha captured profits from short positions in crude oil and gasoil. The Volt Program’s trading in equities was flat month-to-date, as the high volatility in equity markets closed out most equity positions. “Soft commodity trading posted gains on the short side in several markets,” adds Safvenblad. In metal trading, gains from a short position in copper were offset by losses from a long position in gold. “Interestingly, gold has defied its safe-haven status and is down on the month,” writes Safvenblad in the letter.

Subscribe to HedgeBrev, HedgeNordic’s weekly newsletter, and never miss the latest news!

Our newsletter is sent once a week, every Friday.

Eugeniu Guzun
Eugeniu Guzun
Eugeniu Guzun serves as a data analyst responsible for maintaining and gatekeeping the Nordic Hedge Index, and as a journalist covering the Nordic hedge fund industry for HedgeNordic. Eugeniu completed his Master’s degree at the Stockholm School of Economics in 2018. Write to Eugeniu Guzun at eugene@hedgenordic.com

Latest Articles

First Non-Swedish Family Office Investment for Protean Small Cap

Stockholm (HedgeNordic) – About one year after the successful launch of their long/short equity fund Protean Select, Pontus Dackmo and Carl Gustafsson introduced a...

Atlant Högräntefond Leads Peers on Third Anniversary

Stockholm (HedgeNordic) – Around mid-March 2021, Swedish hedge fund boutique Atlant Fonder launched a UCITS-structured fixed-income fund investing in Nordic corporate bonds, drawing from...

Rhenman Welcomes Brummer & Partners Sales Veteran

Stockholm (HedgeNordic) – After close to 18 years as an institutional sales professional at Brummer & Partners, Tom Josephson is set to join healthcare-focused...

Untapped Potential in Symmetry’s Small-Cap Portfolio

Stockholm (HedgeNordic) – Small-cap-focused hedge fund Symmetry Invest has achieved an annualized return of around 20 percent over the past five years and over...

Navigating Asia-Pacific’s Transition to Sustainable Growth

Stockholm (HedgeNordic) – Emerging markets in the Asia-Pacific region, such as China, India, Indonesia, the Philippines, Thailand and Vietnam, have experienced significant economic expansion...

The Performance of US Equities in Election Years Over the Last Century

By Daniel Ung, Kartik Chawla, and Jędrzej Miklaszewski – SPDR: The 2024 US presidential election is on the horizon, and investors are keen to...

Allocator Interviews

Latest Articles

In-Depth: Emerging Markets

Voices

Request for Proposal

- Advertisement -