In May 2025, the NHX CTA Index was down again as profits in rebounding stock markets were not enough to offset losses in fixed income and soft commodities. With few exceptions, performance was negative across managers and sub-strategies.
Last month, TSMOM as measured by RPM’s MDI remained almost unchanged at ultralow levels as increasing trendiness in stock indices was offset by reversing trends elsewhere. In equities, global markets rallied, recovering all “liberation day losses” amid stronger-than-expected US data and an unexpected US-China trade de-escalation. However, in the second half of the month, stocks partly reversed after a lackluster bond auction had highlighted concerns about the government’s rising debt burden. Yet, at month-end, equities rallied again after President Trump indicated that trade talks with the EU were progressing in a “positive” direction. In fixed income, US bond yields reversed course, rising throughout the month, amid the stripping of the country’s triple A rating and investors’ unease over President Trump’s “big, beautiful bill”.
In FX, investor jitters about the state of the US’s public finances triggered further declines in the US dollar. In commodities, crude oil prices first slumped on renewed concerns of a global supply glut following Opec’s decision to increase output for a second consecutive month before reversing all losses due to easing trade tensions. Elsewhere, gold futures fell amid easing safe-haven demand amid Donald Trumps’ climb-down on most of his announced tariffs. Coffee futures experienced a sharp decline, pressured by bumper crops in Brazil and a slowdown in global consumption. US beef prices soared to record highs as the country’s cattle inventory reached its lowest level in more than 70 years, putting further strains on Americans’ grocery bills. In cryptocurrencies, bitcoin hit a record high amid growing industry optimism that the US would shortly agree to its first regulations for digital assets.
Most NHX trend following managers were down with relative performance depending on programs’ trading horizons (shorter-term was better for performance) and relative commodity exposure (higher commodity exposure was worse for performance). Calculo Evolution, Estlander Alpha Trend, Lynx, and SEB Asset Selection all ended the month in negative territory mainly due to losses in bonds and softs, whereas Mandatum Managed Futures (adaptive short-term, no commodities) was up again on the back of rebounding equity markets.
Almost all NHX’s non-trend following managers ended the month in negative territory as well. Regarding short-term trading strategies, Lynx Constellation and Epoque were down mainly due to losses in FI and FX. Regarding macro and multi-strategy managers, Lynx Systematic Macro and Volt were down mainly due to losses in fixed income whereas Estlander Freedom was flat as profits in stocks balanced those losses in bonds. Crypto specialist manager Anna was down. Multi-manager program RPM Evolving also ended the month in negative territory as the underlying managers’ profits in stocks were not enough to offset losses in bonds and soft commodities.
Markets remain jittery hanging on the US president’s lips. Whereas volatility has come down, uncertainty in financial markets remains high. As US statistics keep improving, at this point, only the Federal Reserve can give markets some direction. However, the next rate decision is not due before June 18th.
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