Last year’s second-best performing Nordic hedge fund, Coda Global Opportunities, began 2026 with a strong 10.4 percent return in January, despite suffering a sharp two-day drawdown at month-end amid what the team described as “one of the most violent precious-metals sell-offs in decades.” Although the fund’s portfolio managers Peter Andersland and Knut Børsheim had meaningfully reduced exposure to precious metals ahead of the decline, they were nonetheless caught off guard and surprised by the speed, scale, and apparent coordination of the sell-off.
“We significantly underestimated the magnitude of the move,” the team at Coda Partners writes. “Had we anticipated that silver would experience its largest daily decline in more than 50 years, exposure would have been reduced further.” The fund was up nearly 15 percent year-to-date through January 28, before ending the month with a 10.4 percent gain after the late-month drawdown. “Despite the steep two-day decline at the very end of the month, January ultimately concluded with a strong result,” the team notes, adding that the drawdown was driven by “extreme and highly unusual price action in precious metals during the final trading days.”
“We significantly underestimated the magnitude of the move. Had we anticipated that silver would experience its largest daily decline in more than 50 years, exposure would have been reduced further.”
Coda Global Opportunities is a low-net, long/short equity fund employing a thematic investment approach with a particular focus on cyclical industries. Gold and silver have been core allocations for Andersland since he began running the strategy, first under Pensum Global Opportunities in 2022 and later under Coda Global Opportunities from last year. While the investment team brings more than 60 years of combined experience across cyclical industries, they acknowledge being surprised by the nature of the sell-off.
Engineered Crash or Cycle Peak?
“The events in precious metals warrant discussion,” the team writes. “Without resorting to conspiracy theories, the speed, scale, and coordination of the sell-off certainly raises some eyebrows, as to whether it was engineered.” The team outlines two possible explanations: either the move marked the tail end of a blow-off top, signaling the end of the bull market in gold and silver, or it represented a forced or engineered sell-off aimed at relieving pressure on banks holding large short positions.
“Whereas we believe the latter to carry a higher probability – there were just too many coincidences – obviously we cannot know for sure,” the team adds. Among the factors cited were unchanged fundamentals in silver supply, the absence of COMEX circuit breakers despite the extreme price action, and a U.S. bank closing its silver short positions almost precisely at the market lows.
“We need to see signs of reduced selling pressure and evidence that buyers are stepping back in.”
In response, the Coda team has so far refrained from rebuilding the reduced precious-metals exposure. “We need to see signs of reduced selling pressure and evidence that buyers are stepping back in,” the team explains. “If the precious metals can catch a bid once again, and if the banks have covered their short positions, the next move up could be extraordinary.”
Despite the late-month drawdown, gold, silver, and platinum miners were the largest contributors to performance in January. Other positive contributors included exposures to nuclear energy, oil and gas, copper miners, and steel producers. The fund’s short book also generated positive returns, led by short positions in information technology and consumer discretionary stocks, while market hedges detracted from overall performance.
