Factbox – For commodity trading advisors, oil’s downtrend has been a friend

NEW YORK (Reuters) – The nearly two-month-long slide in oil prices to 6-1/2 year-lows has been a boon to many so-called systematic funds, which trade based on technical signals or computer algorithms rather than fundamentals. While most market commentary has focussed on the persistent glut in the global market caused by unrelenting OPEC output and surprisingly resilient U.S. shale production, these commodity trading advisors (CTAs) have ridden the downtrend to robust returns. It is too early to say how most of them fared on Thursday, as oil prices surged by more than 10 percent in the biggest one-day gain since the financial crisis. Interviews with five of the larger and best-performing CTAs also show that investors who opened or maintained short positions have reaped significant profits this year, despite a rally that began after the previous lows were hit in March. Several of those successful funds have paid no attention to fundamentals like an oversupply from resilient U.S. production or concerns about Chinese demand. Instead, these “systematic” funds have simply let their algorithms respond to price trends. Below is information on the strategies, exposure and results of systematic, trend-following funds with bets on oil and other commodities: ASPECT CAPITAL Location: … continue reading

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Source: CTRM Center

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