I’ve written before about the merits of systematic trading…indeed I do a bit myself, in addition to investing with some quant shops. Anyway, looks like they had a better year in 2014 than most stock pickers. Congrats to those who have been long-term patient with the momentum traders – as expected/hoped/implicit in momentum strategies, years of lacklustre performance (e.g. 2009-2013) were more than compensated by 2014’s returns for a great many funds.
This leads to both Q & A:
- A: I distinct recall speaking with many existing/potential investors in managed futures/systematic trading, in which the question was asked: is momentum dead? Are the systems broken? Hopefully 2014 helps answer that.
- Q: is the performance of 2014 sustainable? For example, 2008 was a great year for the strategy, with a bad year in 2009. So will 2015 be like 2009? I wish I knew, but for the moment I’m staying invested.