Kettera Strategies' February 2021 Heat Map Lays it Out
In February, short-term strategies showed positive results overall, but many key markets experienced volatility breakouts. This was particularly true for industrial metals traders, who capitalized on the month, especially those long in industrial metals markets like copper. However, the performance of Systematic Trend programs in commodities, especially in industrial metals and energies, showed a challenging start to 2021.
Throughout the early months of 2021, the outlook was characterized by market whipsaws and a lack of strong, sustained trends. This made it difficult for systematic trend programs to capture clear directional moves in industrial metals and energy commodities.
Despite commodity markets rallying strongly later in 2025, earlier periods—including 2021—had more muted and volatile performance for trend-following programs in commodity futures. As of August 2025, the SG Trend Index—representative of trend-following performance—showed overall negative year-to-date returns and a moderately weak trend environment.
While specific quantified performance data for systematic trend programs solely over January-February 2021 is not explicitly detailed, the available context highlights a difficult trading environment in early 2021 for trend-following strategies in commodities, with limited strong trends especially in industrial metals and energies.
Event-driven managers, which include merger arbitrage strategies, had an outsized month in February. As SPACs continue to gain in popularity, this sector also was a source of strong contributions among event-driven programs. Most event-driven programs capitalized on deal flow in the technology, financials, and health care sectors.
Energy traders performed well, especially those with long exposures to crude and refined products markets. Energy and base metals strategies outperformed agricultural programs in commodities markets in February. Those nimble enough to short rates and bonds, especially in the last week of February, booked outsized returns.
It's important to note that the views expressed in this article are those of the author and not necessarily those of AlphaWeek or its publisher, The Sortino Group. Indices and other financial benchmarks mentioned are provided for illustrative purposes only.
References:
[1] SG Trend Index: https://www.sgcib.com/en/trend-index [2] BarclayHedge Currency Traders Index: https://www.barclayhedge.com/index/index.html?Index=Currency%20Traders%20Index [3] BTOP FX Traders Index: https://www.barclayhedge.com/index/index.html?Index=BTOP%20FX%20Traders%20Index [4] Barclay Crypto Traders Index: https://www.barclayhedge.com/index/index.html?Index=Crypto%20Traders%20Index [5] Blend of BarclayHedge Equity Market Neutral Index with Eurekahedge Equity Mkt Neutral Index: https://www.eurekahedge.com/index/index.html?Index=Equity%20Market%20Neutral%20Index [6] Eurekahedge-Mizuho Multi-Strategy Index: https://www.eurekahedge.com/index/index.html?Index=Eurekahedge-Mizuho%20Multi-Strategy%20Index [7] Eurekahedge AI Hedge Fund Index: https://www.eurekahedge.com/index/index.html?Index=AI%20Hedge%20Fund%20Index [8] Eurekahedge Long Short Equities Hedge Fund Index: https://www.eurekahedge.com/index/index.html?Index=Long%20Short%20Equities%20Hedge%20Fund%20Index [9] CBOE Eurekahedge Relative Value Volatility Hedge Fund Index: https://www.eurekahedge.com/index/index.html?Index=Relative%20Value%20Volatility%20Hedge%20Fund%20Index [10] S&P GSCI Metals & Energy Index: https://us.spindices.com/indices/commodity/sp-gsci-metals-energy-index [11] S&P GSCI Ag Commodities Index: https://us.spindices.com/indices/commodity/sp-gsci-ag-commodities-index
Faced with a challenging start to 2021, investors in systematic trend programs found it difficult to capture clear directional moves in industrial metals and energy commodities, which could have benefited from technology-driven insights and innovations in financial investing. Despite the volatile performance in early 2021, event-driven managers, including those focused on technology sectors, capitalized on strong contributions in February.
