Stockholm (HedgeNordic) – RPM Evolving CTA Fund, which invests in a select group of young and evolving CTA managers, marked its ten-year milestone in June. Despite mostly operating in an environment unfavorable for trend-following CTAs characterized by subdued volatility and lack of trends, the fund has delivered an annualized return of 3.2 percent since inception. Notably, RPM Evolving CTA Fund achieved its strongest annual performance in 2022 with a gain of 24.3 percent.
“June proudly marks the 10th anniversary of the fund, a significant milestone!”
“June proudly marks the 10th anniversary of the fund, a significant milestone!,” says an investor letter written by the RPM team led by founder and CEO Mikael Stenbom. “It outperformed relevant benchmarks during the challenging environment up until 2021 during which Central Bank action threw a wet blanket over markets, and the CTA industry was struggling.” RPM Evolving CTA Fund started off its journey on a strong note in mid-2013, with a cumulative return of 18 percent in the first one and a half years. However, the fund faced ups and downs until 2021 due to subdued volatility and a lack of trends caused by central bank actions. The emergence of inflation, rising interest rates, and increased uncertainty led to a more favorable environment with increased trendiness across markets.
In 2022, RPM Evolving CTA Fund had its best-performing year to date, ending as the fifth best-performing hedge fund in the Nordics with a return of 24.3 percent. “The reintroduction of inflation, higher interest rates, and overall uncertainty has remarkably benefited not only the fund itself, but also the industry as a whole,” comments the RPM team. “These prevailing conditions have provided advantageous opportunities for CTA returns and as we look ahead to the future, we remain committed to delivering continued success for our investors.”
RPM Evolving CTA Fund focuses on investing in young CTAs during their “Evolving Phase,” which the RPM team considers the most dynamic and competitive phase of their life cycle from a risk-return perspective. Typically, CTAs in this phase have a track record of two to seven years and manage assets ranging from $ 20 million to $1 billion. The fund allocates to four different CTA sub-strategies, with Trend Following as the core allocation, and Short-term Trading, Commodity, and Fundamental CTAs serving as diversifying and balancing components.
