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Quant Funds Face Worst Slump Since 2023
6 Jul
Summary
- Quantitative hedge funds are experiencing their worst performance since 2023.
- A long-short momentum strategy has dropped over 3% for two consecutive weeks.
- This decline is attributed to a violent rotation within the stock market.
Quantitative hedge funds are currently navigating their worst performance streak since 2023. This challenging period is characterized by significant market volatility.
A specific strategy, known as long-short momentum, has been particularly hard-hit. This approach involves buying assets that have recently performed well and selling those that have lagged. However, it has experienced a substantial decline, dropping more than 3% for two consecutive weeks.
This downturn is a direct consequence of a violent rotation occurring within the underlying stock market. The market's previously bullish trend is being challenged, creating an unfavorable environment for many quantitative strategies.
