Kettera Strategies Heat Map - October 2025

For its examination of October, the following highlights five of the various style categories that Kettera covers.

Systematic Trend

Long term trend programs were positive in October, primarily supported by gains in long equity index positions in the US and Asia (Japan). FX was the second-best performing sector, led by long USD positions vs. G10, most notably the JPY, as the USD rallied over 4% versus the yen. Fixed income did not seem to contribute meaningfully to most trend programs’ October P/L. Commodities were mixed, with strong gains in long precious metals (gold, silver, platinum, palladium) offset by losses in agricultural grains and energies – both of which were undermined by sharp intra-month reversals. (Soybeans, corn, and crude oil all moved against established trends.) In short, programs overweighted to commodities underperformed those more concentrated in the financial sectors.

Currency Specialists

October was a positive month overall for currency managers, although there was some dispersion between price-based and more fundamentally based programs. Those able to identify high conviction-based trades—especially in G10 majors—generally outperformed. A recurring theme among the more profitable programs was an ability to identify the month as “USD bullish,” but also the capacity to manage (very) choppy mid-month USD price action. (This was particularly the case with the euro). Some of the more macroeconomic-driven managers we’ve spoken with noted a breakdown in historical relationships between fundamentals/news and currency behavior. Accordingly, managers favoring momentum or breakout-style strategies seemed to nimbly capture the overall USD trend (and, in many cases, the mid-month correction). That said, a longer-term fundamentally based quant macro program we track also did quite well (although they do incorporate some price-based and momentum models that likely helped).  Programs trading gold (and silver) as pseudo currencies also did best to catch the early month rise to new highs, and exit before the sharp reversal late-month.

Short-Term / Higher Frequency Trading Programs

Short-term programs were generally positive, with the usual dispersion across performance attribution and degree of profitability. For most programs, the better performing sectors were long equities and long USD during the early part of the month. We note that the quicker strategies, those with intra-day and 1-2 -day holding periods, outperformed those with longer average holding periods, as the former were able to navigate the choppier markets better. And the most choppy markets seemed to be the commodities, where energies and grains were particularly poor performers, although most ST programs seemed to do well in the metals markets. Price-based short-term systems outperformed those relying on a heavier dose of macro-fundamental inputs.

Commodities Specialists – Industrial Commodities

Managers focused on the industrial commodities markets, including energy, metals, and freight, were generally positive in October - metals specialists appearing to outperform the others. Most of the programs we follow in this category are discretionary and fundamental, with holding periods of weeks to several months. The metals funds benefited from a rise in precious metals, notably gold and silver, and base metal copper. (Copper and gold actually reached new all-time highs before pulling back.) Relative value spreads and arbitrage strategies in the metals complex was also generally profitable. In energies, crude oil and products-focused strategies were slightly positive, while the natural gas programs we follow, primarily using spreads, seemed to outperform their oil-trading peers – notable given the very choppy month.

Quant Global Macro

Quant macro strategies were generally positive in October, with solid contributions across multiple asset classes - but with the usual dispersion among sources of returns. While most programs in this category do not rely on price-based systems, those incorporating some form of trend component tended to outperform those without. This was particularly evident in directional moves in equity indices and commodities (e.g. metals and softs). Programs with some form of volatility-based filters also showed more stable return streams. (This may help explain why managers using VIX- or options-based models performed well during mid-month volatility spikes.) Fixed income positions also seemed to contribute, especially for strategies with models attuned to yield curve shocks, capturing gains in UK Gilts and U.S. Treasuries. In currencies, results were more mixed. Echoing our comment under Currency Specialists above, quant macro funds dependent on fundamental relationships faced headwinds as currencies were more driven by momentum and psychology. In commodities, energy and metals stood out as bright spots—again, particularly for price-based models—while agriculture and natural gas exposures proved more challenging.

Kettera Strategies September 2025 Style Map

Past performance is not necessarily indicative of future results. See notes at end of this document for details on the construction of the Hydra "baskets" and the benchmark used for each style class. Also note that some baskets may contain managers that have not yet reported by this date. *=Less than 75% reported. **=Less than 75% reported and absence of a core manager's return.

*=less than 75% reported.

**=less than 75% reported and absence of a core manager's return.

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Kettera Strategies

Footnotes

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Kettera Strategies. The information set forth herein has been obtained or derived from sources believed by the author to be reliable. However, neither Kettera nor the author make any representation or warranty, express or implied, as to the information's accuracy or completeness, nor do Kettera or the author recommend that the attached information serve as the basis of any investment decision. This is provided to you solely for informational purposes only and does not constitute an offer or solicitation of an offer, or any advice or recommendation, to purchase any securities or other financial instruments, and may not be construed as such.

Kettera Strategies LLC is a Member of the National Futures Association and registered as a Commodity Pool Operator and only provides services to Accredited Investors who are Qualified Eligible Persons as defined in section 4.7 of the Commodity Exchange Act. This document, any attached document and cover email are being furnished to you on a confidential basis and may not, without prior written consent of Kettera Strategies LLC be (i) copied, photocopied or duplicated in any form, by any means, or (ii) distributed to any person that is not an employee, officer, director, or authorized agent of the intended recipient of this email. This document, and any related documents or emails, are neither offers to sell any securities, nor solicitations of an offer to invest in any fund or product.

For the “style classes” and “baskets” presented in this letter: The “style baskets” referenced above were created by Kettera for research purposes to track the category and are classifications drawn by Kettera Strategies in their review of programs on and for the Hydra Platform. The arrows represent the style basket’s overall performance for the month (e.g. the sideways arrow indicates that the basket was largely flat overall, a solid red down arrow indicates the basket (on average) was largely negative compared to most months, etc.). The “style basket” for a class is created from monthly returns (net of fees) of programs that are either: programs currently or formerly on Hydra; or under review with an expectation of being added to Hydra. The weighting of a program in a basket depends upon into which of these three groups the program falls. Style baskets are not investible products or index products being offered to investors. They are meant purely for analysis and comparison purposes. These also were not created to stimulate interest in any underlying or associated program. Nonetheless, as these research tools may be regarded to be “hypothetical” combinations of managers.

Further notes on Hydra Emerging Manager Basket: Weightings among managers were rebalanced every year, with exceptions for extraordinary events (e.g. the Covid market collapse). Weightings are not discretionary. Manager weightings were not increased over time except for going from a “pending” to a fully “approved” program; weighting reductions only occurred if the manager was de-listed or shut its doors – otherwise the managers stayed as is regardless of performance. Weightings are equal for any approval category: e.g. all fully approved managers may get a X% weighting, regardless of volatility/exposure levels or correlation with other strategies.

Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any product or account will achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.

Benchmark sources:

1-            With Intelligence Systematic Macro Hedge Fund Index

2-            With Intelligence Macro Hedge Fund Index

3-            The Societe Generale Trend CTA Index

4-            The Societe Generale Short-term Traders Index

5-            The Barclay Currency Traders Index

6-            Blend of Bridge Alternatives Commodity Hedge Fund Index and BarclayHedge Discretionary Traders Index

7-            The Barclay Agricultural Traders Index

8-            The Nilsson CTA Commodities Index

9-            Blend of With Intelligence Volatility Arbitrage Index and With Intelligence Long Volatility Hedge Fund Index

Indices and other financial benchmarks shown are provided for illustrative purposes only, are unmanaged, reflect reinvestment of income and dividends and do not reflect the impact of advisory fees. Index data is reported as of date of publication and may be a month- to-date estimate if all underlying components have not yet reported. The index providers may update their reported performance from time to time. Kettera disclaims any obligation to verify these numbers or to update or revise the performance numbers.

Past performance is not necessarily indicative of future returns.

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The views expressed in this article are those of the author(s) and do not necessarily reflect the views of AlphaWeek or its publisher, The Sortino Group