- Advertisement -
- Advertisement -

No Bitcoin for Volt

- Advertisement -

Stockholm (HedgeNordic) – Man Group’s quantitative investment unit AHL is already trading bitcoin futures, while Renaissance Technologies’ Medallion Funds have received permission to enter into bitcoin futures transactions – albeit limited to cash-settled futures contracts traded on the CME. Swedish fundamentals-based systematic Volt Diversified Alpha, however, is not planning on touching bitcoin because of a lack of fundamentals.

Bitcoin and other cryptocurrencies “do not have accessible fundamentals that we could build a model on,” Patrik Säfvenblad, the chief investment officer of Volt Capital Management, tells Bloomberg. “When there is a crisis, markets generally move toward fundamentals. Not the old fundamentals but new, different fundamentals,” he continues. If a security does not provide any fundamental value anchors, “we stay away from that,” says Säfvenblad.

“When there is a crisis, markets generally move toward fundamentals. Not the old fundamentals but new, different fundamentals.”

Volt Diversified Alpha, the “Best Nordic CTA” of 2020 at the Nordic Hedge Award following a 41 percent gain in 2020, uses machine learning and fundamental data to capture price moves across various markets motivated by changes in underlying economic factors. A lack of fundamentals is just one of the reasons the Volt team is staying away from trading bitcoin futures. The team is not ready to hold an instrument ultimately designed to dodge public scrutiny, Säfvenblad tells Bloomberg. Volt would “much prefer to be in a regulated market with regulated trading,” he says. “And Bitcoin is not yet fully regulated.”

With fundamentals being “a far superior indicator to predict market developments,” according to Säfvenblad, Volt Diversified Alpha relies on 250 different fundamental models weighted by their expected contribution in a given market regime to catch price moves. The fund’s current positioning represents what Säfvenblad calls a “nervous long,” according to Bloomberg. “In the past few weeks, the program has turned more bearish,” he tells Bloomberg. “We have some positions that anticipate a slowdown, for example long fixed-income, and the models have now trimmed our long positions in commodities. Today, the portfolio reflects a more balanced outlook.”

“We have some positions that anticipate a slowdown, for example long fixed-income, and the models have now trimmed our long positions in commodities. Today, the portfolio reflects a more balanced outlook.”

“We don’t say that we know where the world is heading,” Säfvenblad tells Bloomberg. “But we have a system that monitors everything that could mean something.” Volt Diversified Alpha, launched in March of 2017, celebrated its fourth anniversary earlier this year, with the fund delivering an annualized 10.3 percent since inception. The fund is 4.1 percent in the first five months of 2021.

close

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

Most Popular This Week

Request for Proposal

- Advertisement -

Latest Articles

The Spectacular Unspectacular 20th Anniversary

Stockholm (HedgeNordic) – Reaching the 20th anniversary in the often short-lived and fast-paced hedge fund world is quite an achievement. In fact, some activity...

Head of Research Havnen Leaves CARN

Stockholm (HedgeNordic) – Harald Havnen is leaving CARN Capital and his role as Head of Research to join Norway’s largest pension fund advisor Gabler...

Strand to Launch the “Essential”

Stockholm (HedgeNordic) – Former hedge fund manager Eric Strand is launching the fourth fund under his own fund boutique AuAg Fonder after receiving approval...

Back to the Old Home

Stockholm (HedgeNordic) – Carnegie’s previously announced acquisition of Carnegie Fonder has been completed. The acquisition completed under the umbrella of the newly formed Carnegie...

Round Table: ETFs & Asset Management

Stockholm (HedgeNordic) – At a round table discussion that took place in Stockholm on October 17, asset managers and ETF providers discussed and answered...

Nordic Managers Win EuroHedge Nominations

Stockholm (HedgeNordic) – With Intelligence has released the first round of nominations for the EuroHedge Awards 2022, with the list featuring seven Nordic hedge...